8A.      Sharia compliant financing arrangements

(1)     For the purposes of this Act, in the case of any murabaha as defined in section 24JA(1) of the Income Tax Act–

(a)     the financier shall be deemed not to have acquired or supplied goods under the sharia arrangement;

[Paragraph (a) substituted by section 132 of Act 24 of 2011 effective on 1 January 2013]

(b)     the client shall be deemed to have acquired the goods-

(i)      from the seller for consideration equal to the amount paid by the financier to the seller; and

(ii)     at such time as the supply was made by the seller by virtue of the transaction between the seller and the financier; and

[Paragraph (b) substituted by section 132 of Act 24 of 2011 effective on 1 January 2013]

(c)     any premium paid or payable to the financier by the client shall be deemed to be consideration in respect of a financial service supplied by the financier as contemplated in section 2(1)f): Provided that this paragraph shall not apply to the extent to which the consideration constitutes any fee, commission or similar charge.

[Paragraph (c) substituted by section 132 of Act 24 of 2011 effective on 1 January 2013]

(2)     For the purposes of this Act, in the case of any diminishing musharaka as defined in section 24JA(1) of the Income Tax Act–

(a)     the bank shall be deemed not to have acquired or supplied goods under the sharia arrangement;

(b)

(i)      where the bank and the client jointly acquire goods, the client shall be deemed to have acquired the bank’s interest in the goods-

(aa)   for an amount equal to the amount payable by the bank in respect of its interest in the goods; and

(bb)   at the time that the seller of the goods was divested of any interest in the goods by virtue of the transaction between the seller and the bank; or

(ii)     where the bank acquires an interest in the goods from the client, the client shall be deemed not to have supplied an interest in the goods to the bank; and

(c)     any amount contemplated in section 24JA(6)(a) of the Income Tax Act paid or payable to the bank by the client shall be deemed to be consideration in respect of an exempt financial service supplied by the bank as contemplated in section 2(1)(f): Provided that this paragraph shall not apply to the extent to which the consideration constitutes any fee, commission or similar charge.

[Paragraph (c) amended by section 69 of Act 34 of 2019]