“debt” includes any contingent liability;
[Definition of “debt” inserted by section 50 of Act 17 of 2017 effective on 18 December 2017]
Category: Definitions – ITA
“Concession or compromise” definition of paragraph 12A of Eighth Schedule
‘concession or compromise’ means any arrangement in terms of which-
(a) a debt is-
(i) cancelled or waived; or
(ii) extinguished by-
(aa) redemption of the claim in respect of that debt by the person owing that debt or by any person that is a connected person in relation to that person; or
(bb) merger by reason of the acquisition, by the person owing that debt, of the claim in respect of that debt,
otherwise than as the result or by reason of the implementation of an arrangement described in paragraph (b);
(b) a debt owed by a company to a person is settled, directly or indirectly-
(i) by being converted to or exchanged for shares in that company; or
(ii) by applying the proceeds from shares issued by that company;
[Definition of ‘concession or compromise’ substituted by section 77 of Act 23 of 2018 effective on 1 January 2018, applies in respect of years of assessment commencing on or after that date]
“Debt benefit” definition of paragraph 12A of Eighth Schedule
‘debt benefit’, in respect of a debt owed by a person to another person, means-
(a) in the case of an arrangement described in paragraph (a)(i) of the definition of ‘concession or compromise’, the amount cancelled or waived;
(b) in the case of the extinction of that debt by means of an arrangement described in paragraph (a)(ii) of the definition of ‘concession or compromise’, the amount by which the face value of the claim in respect of that debt held by the person to whom the debt is owed prior to the entering into of that arrangement exceeds the expenditure incurred in respect of-
(i) the redemption of that debt; or
(ii) the acquisition of the claim in respect of that debt;
(c) in the case of the settling of that debt by means of an arrangement described in paragraph (b) of the definition of ‘concession or compromise’, where the person who acquired shares in a company in terms of that arrangement held no effective interest in the shares of that company prior to the entering into of that arrangement, the amount by which the face value of the claim held in respect of that debt prior to the entering into of that arrangement exceeds the market value of the shares acquired by reason or as a result of the implementation of that arrangement; or
(d) in the case of the settling of that debt by means of an arrangement described in paragraph (b) of the definition of ‘concession or compromise’, where the person who acquired shares in a company in terms of that arrangement held an effective interest in the shares of that company prior to the entering into of that arrangement, the amount by which the face value of the claim held in respect of that debt prior to the entering into of that arrangement exceeds the amount by which the market value of the effective interest held by that person in the shares of that company immediately after the implementation of that arrangement exceeds, solely as a result of the implementation of that arrangement, the market value of the effective interest held by that person in the shares of that company immediately prior to the entering into of that arrangement;
[Definition of ‘debt benefit’ substituted by section 77 of Act 23 of 2018 effective on 1 January 2018, applies in respect of years of assessment commencing on or after that date]
“Exempt dividend” definition of paragraph 43A of Eighth Schedule
‘exempt dividend’ means any dividend or foreign dividend to the extent that the dividend or foreign dividend is-
(a) not subject to tax under Part VIII of Chapter II; and
(b) exempt from normal tax in terms of section 10(1)(k)(i) or section 10B(2)(a) or (b);
“Extraordinary dividend” definition of paragraph 43A of Eighth Schedule
‘extraordinary dividend’, in relation to-
(a) a preference share, means so much of the amount of any dividend received or accrued in respect of that share as exceeds the amount that would have accrued in respect of that share had it been determined with reference to the consideration for which that share was issued by applying an interest rate of 15 per cent per annum for the period in respect of which that dividend was received or accrued;
[Paragraph (a) substituted by section 80(1)(c) of Act 23 of 2018 and by section 62(1)(a) of Act 34 of 2019]
(b) any other share, means so much of the amount of any dividend received or accrued-
(i) within a period of 18 months prior to the disposal of that share; or
(ii) in respect, by reason or in consequence of that disposal,
as exceeds 15 per cent of the higher of the market value of that share as at the beginning of the period of 18 months and as at the date of disposal of that share:
Provided that a dividend in specie that was distributed in terms of a deferral transaction must not be taken into account to the extent to which that distribution was made in terms of an unbundling transaction as defined in section 46(1)(a) or a liquidation distribution as defined in section 47(1)(a);
[Definition of “extraordinary dividend” amended by section 62(1)(b) of Act 34 of 2019 deemed effective on 30 October, 2019 and applicable in respect of dividends received or accrued on or after that date and by section 62(1)(c) of Act 34 of 2019]
“Qualifying interest” definition of paragraph 43A of Eighth Schedule
‘qualifying interest’ means an interest held by a company in another company, whether alone or together with any connected persons in relation to that company, that constitutes-
(a) if that other company is not a listed company, at least-
(i) 50 per cent of the equity shares or voting rights in that other company; or
(ii) 20 per cent of the equity shares or voting rights in that other company if no other person (whether alone or together with any connected person in relation to that person) holds the majority of the equity shares or voting rights in that other company; or
(b) if that other company is a listed company, at least 10 per cent of the equity shares or voting rights in that other company.
“Negative liability” definition of 29A of ITA
“negative liability”, in respect of a long-term policy, means the amount by which the expected present value of future premiums exceeds the expected present value of future benefits to policyholders and expenses;
[Definition of “negative liability” inserted by section 53(1)(a) of Act 25 of 2015 and substituted by section 46(1)(b) of Act 17 of 2017 deemed effective on 1 July 2018 and applicable in respect of years of assessment ending on or after that date – effective date in terms of section 53(2) of Act 25 of 2015 as substituted by section 108(1) of Act 23 of 2018 and effective date in section 46(2) of Act 17 of 2017 as substituted by section 114(1)(a) of Act 23 of 2018)]
“Credit amount” definition of section 89quat of ITA
“credit amount”, in relation to any year of assessment of any provisional taxpayer, means the sum of –
(a) the provisional tax paid by the taxpayer under the provisions of paragraph 21, or 23 of the Fourth Schedule in respect of such year;
(b) any additional provisional tax paid by the taxpayer in respect of such year under the provisions of paragraph 23A of that Schedule;
(c) any amounts of employees tax deducted or withheld by the taxpayer’s employer during such year; and
(d) any amount of foreign taxes which may be deducted from the tax payable by such taxpayer in respect of the relevant year of assessment in terms of the provisions of section 6quat;
“Effective date” definition of section 89quat of ITA
“effective date”, in relation to any year of assessment of a provisional taxpayer, means –
(a) where the provisional taxpayer is a company which has a year of assessment which ends on the last day of February or is a person (other than a company) who has not been granted permission by the Commissioner under the provisions of section 66(13A) to render accounts for a period ending on a date other than the last day of February, the date falling seven months after the last day of such year; or
(b) in any other case, the date falling six months after the last day of such year as applicable for the purposes of the provisions of paragraph 21 or 23 of the Fourth Schedule;
“Normal tax” definition of section 89quat of ITA
“normal tax” includes any additional amounts payable in terms of section 76 and paragraph 20 of the Fourth Schedule.
[Definition of “normal tax” added by section 42 of Act 113 of 93 and substituted by section 3 of Act 22 of 2018 effective on 17 January 2019]