Category: Section 72A (ITA) – Return relating to controlled foreign company

Section 72A

 

  1. Subsection (1) substituted by section 11 of Act 32 of 2005, and section 13 of Act 4 of 2008 effective on 3 July 2008 and section 271 of Act 28 of 2011 effective on 1 October 2012.

 

  1. Subsection (2) substituted by section 11 of Act 32 of 2005 and section 18 of Act 21 of 2012 effective on 1 January 2012.

 

  1. Paragraph (3)(a) deleted by section 11 of Act 32 of 2005.

 

  1. Section 72A inserted by section 46 of Act 59 of 2000, amended by section 42 of Act 74 of 2002 and substituted by section 65 of Act 45 of 2003.

Section 72A (ITA) – Returns relating to controlled foreign company

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72A.    Return relating to controlled foreign company

 

(1)     Every resident who on the last day of the foreign tax year of a controlled foreign company or immediately before a foreign company ceases to be a controlled foreign company directly or indirectly, together with any connected person in relation to that resident, holds at least 10 per cent of the participation rights in any controlled foreign company (otherwise than indirectly through a company which is a resident), must submit to the Commissioner a return.

 

(2)     A resident must have available for submission to the Commissioner when so requested, a copy of the financial statements of the controlled foreign company for the relevant foreign tax year of that controlled foreign company.

 

(3)     Where a person in respect of any year of assessment fails to comply with the provisions of-

 

(a)     ……….

 

(b)     subsection (2) and no reasonable grounds exist either for that failure which is outside the control of the person or for that person to believe that such person was not subject to that requirement-

 

(i)      the proportional amount which must be included in the income of that person in terms of section 9D for that year shall be determined with reference only to the receipts and accruals of the controlled foreign company; and

 

(ii)     the provisions of section 6quat shall not apply in respect of any tax proved to be payable to the government of any other country with respect to the proportional amount of the net income of that controlled foreign company which is included in the income of that person in terms of section 9D.

 

73.  ……….

 

74.  ……….

 

75.  ……….

 

76.  ……….