(i) any expenditure, loss or allowance to the extent to which it is claimed as a deduction from any retirement fund lump sum benefit or retirement fund lump sum withdrawal benefit;
(j) ……….
Category: PART I – Normal Tax (ITA)
Section 23(k) of ITA
(k) any expense incurred by-
(i) a labour broker as defined in the Fourth Schedule, other than a labour broker in respect of which a certificate of exemption has been issued in terms of paragraph 2(5) of the said Schedule; or
(ii) a personal service provider as defined in the said Schedule,
other than any expense which constitutes an amount paid or payable to any employee of such labour broker or personal service provider for services rendered by such employee, which is or will be taken into account in the determination of the taxable income of such employee and, in the case of such personal service provider, any expense, deduction or contribution contemplated in paragraphs (c), (i), (l), (nA) or (nB) of section 11, expenses in respect of premises, finance charges, insurance, repairs and fuel and maintenance in respect of assets, if such premises or assets are used wholly and exclusively for purposes of trade;
Section 23(l) of ITA
(l) any expense incurred in respect of the payment of any restraint of trade, except as provided for in section 11(cA).
Section 23(m) of ITA
(m) subject to paragraph (k), an expenditure, loss or allowance, contemplated in section 11, which relates to any employment of, or office held by, any person (other than an agent or representative whose remuneration is normally derived mainly in the form of commissions based on his or her sales or the turnover attributable to him or her) in respect of which he or she derives any remuneration, as defined in paragraph 1 of the Fourth Schedule, other than –
(i) any contributions to a pension fund, provident fund or retirement annuity fund as may be deducted from the income of that person in terms of section 11F;
[Subparagraph (i) substituted by section 56 of Act 31 of 2013 and section 35 of Act 17 of 2017 effective on 1 March 2016]
(ii) any allowance or expense which may be deducted from the income of that person in terms of section 11(c), (e), (i) or (j);
(iiA) any deduction which is allowable under section 11(nA) or (nB);
(iii) any deduction which is allowable under section 11(a) in respect of any premium paid by that person in terms of an insurance policy, to the extent that –
(aa) it covers that person against the loss of income as a result of illness, injury, disability or unemployment; and
(bb) the amounts payable in terms of that policy as contemplated in item (aa) constitutes or will constitute income as defined; and
(iv) any deduction which is allowable under section 11(a) or (d) in respect of any rent of, cost of repairs of or expenses in connection with any dwelling house or domestic premises, to the extent that the deduction is not prohibited under paragraph (b);
Section 23(n) of ITA
(n) any deduction or allowance in respect of any asset or expenditure to the extent that amount –
(i) is granted or paid to the taxpayer and is exempt from tax in terms of section 10(1)(yA); and
(ii) is so granted or paid for purposes of the acquisition of that asset or funding of that expenditure: Provided that the provisions of this paragraph shall not apply if the grant or payment is in respect of programmes or schemes that the Minister has identified by notice in the Gazette for purposes of this paragraph;
Section 23(o) of ITA
(o) any expenditure incurred –
(i) where the payment of that expenditure or the agreement or offer to make that payment constitutes an activity contemplated in Chapter 2 of the Prevention and Combating of Corrupt Activities Act. 2004 (Act No. 12 of 2004);
[Subparagraph (i) amended by section 39 of Act 23 of 2018 effective on 1 April 2019, applies in respect of years of assessment commencing on or after that date]
(ii) which constitutes a fine charged or penalty imposed as a result of an unlawful activity carried out in the Republic or in any other country if that activity would be unlawful had it been carried out in the Republic; or
[Subparagraph (ii) amended by section 39 of Act 23 of 2018 effective on 1 April 2019 and applies in respect of years of assessment commencing on or after that date]
(iii) which constitutes fruitless and wasteful expenditure as defined in section 1 of the Public Finance Management Act and determined in accordance with that Act;
[Subparagraph (iii) added by section 39(1) of Act 23 of 2018 and substituted by section 11 of Act 20 of 2022]
[Paragraph (o) added by section 28(1)(e) of Act 31 of 2005 and amended by section 47(1)(a) of Act 24 of 2011 effective on 1 March, 2012 and applicable in respect of policies ceded on or after that date]
Section 23A (ITA) – Limitation of allowances granted to lessors of certain assets
23A. Limitation of allowances granted to lessors of certain assets
Subsections 2, 3 and 4 of section 23A of ITA
(2) Notwithstanding the provisions of sections 11(e) and (o), 12B, 12BA, 12C, 12DA, and 37B (2)(a) the sum of the deduction which may be allowed to any taxpayer in any year of assessment under those provisions in respect of any affected assets let by the taxpayer shall not exceed the taxable income (as determined before making the said deductions) derived by the taxpayer during such year from rental income.
[Subsection (2) substituted by section 22(1)(c) of Act 101 of 1990, by section 24 of Act 129 of 1991, by section 17(1)(b) of Act 3 of 2008, by section 25(b) of Act 23 of 2020 and by section 24(1)(c) of Act 17 of 2023 effective on 1 March, 2023 and applicable in respect of assets brought into use on or after that date]
(3) For the purposes of subsection (2), where the taxpayer is entitled to any deduction which relates to rental income and other income derived by the taxpayer, an appropriate portion of such deduction shall be taken into account in the determination of the taxable income derived by the taxpayer from rental income.
[Subsection (3) substituted section 24(1)(d) of Act 17 of 2023 effective on 1 March, 2023 and applicable in respect of assets brought into use on or after that date]
(4) Any deduction which is disallowed under the provisions of subsection (2) shall be carried forward to the succeeding year of assessment and shall, subject to the provisions of this section as applicable in relation to that year, be deemed to be a deduction to which the taxpayer is entitled in that year.
“Rental income” definition of section 23A of ITA
“rental income” means income derived by way of rent from the letting of any affected asset in respect of which an allowance has been granted to the lessor under section 11(e), 12B, 12BA, 12C, 12DA or 37B (2)(a), whether in the current or any previous year of assessment, and includes any amount—
(a) which is included in the income of that person in terms of section 8(4) in respect of an amount deducted in any year of assessment in respect of any affected asset; and
(b) derived from the disposal of any affected asset.
[Definition of “rental income” substituted by section 22(1)(b) of Act 101 of 1990, by section 32(1)(c) of Act 60 of 2001, by section 17(1)(a) of Act 3 of 2008, by section 35(b) of Act 17 of 2009 and by section 24(1)(b) of Act 17 of 2023 effective on 1 March, 2023 and applicable in respect of assets brought into use on or after that date]
“Operating lease” definition of section 23A of ITA
“operating lease” means a lease of movable property concluded by a lessor in the ordinary course of a business (not being a banking, financial services or insurance business) of letting such property, if –
(a) such property may be hired by members of the general public directly from that lessor in terms of such a lease, for a period of less than one month;
(b) the cost of maintaining such property and of carrying out repairs thereto required in consequence of normal wear and tear, is borne by the lessor; and
(c) subject to any claim that the lessor may have against the lessee by reason of the lessee’s failure to take proper care of the property, the risk of destruction or loss of or other disadvantage to such property is not assumed by the lessee;