Category: Paragraph 51 (Eighth Schedule) – Transfer of residence from company or trust

Paragraph 51

 

  1. Item (1)(c) substituted by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Item (1)(d) substituted by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Item (2)(a) substituted by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Subitem (2)(b)(ii) amended by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Item (2)(c) amended by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Item (2)(d) deleted by section 104 of Act 7 of 2010 effective on 11 February 2009.

 

  1. Paragraph 51 amended by section 96 of Act 60 of 2001 and section 85 of Act 74 of 2002 and substituted by section 74 of Act 17 of 2009.

Paragraph 51 (Eighth Schedule) – Transfer of residence from company or trust

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51.    Transfer of residence from company or trust

 

(1)     Where an interest in a residence has been transferred from a company or a trust to a natural person as contemplated in subparagraph (2) –

 

(a)     that company or trust must be deemed to have disposed of that interest for an amount equal to the base cost of that interest on the date of transfer thereof;

 

(b)     that company or trust and that natural person must, for purposes of determining any capital gain or capital loss in respect of the transfer of that interest, be deemed to be one and the same person with respect to-

 

(i)      the date of acquisition of that interest by that company or trust and the amount and date of incurral by that company or trust of any expenditure in respect of that interest allowable in terms of paragraph 20; and

 

(ii)     any valuation of that interest effected by that company or trust as contemplated in paragraph 29(4);

 

(c)     no allowance or deduction allowed to that company or trust in respect of that interest must be recovered or recouped by that company or trust or be included in the income of that company or trust in the year in which the transfer takes place; and

 

(d)     that company or trust and that natural person must be deemed to be one and the same person for purposes of determining the amount of any allowance or deduction that is to be recovered or recouped by or included in the income of that natural person in respect of that interest.

 

(2)     Subparagraph (1) applies where –

 

(a)     that natural person acquires that interest from the company or trust no later than 30 September 2010;

 

(b)     that natural person –

 

(i)      alone or together with his or her spouse directly held all the share capital or members interest in that company from 11 February 2009 to the date of registration in the deeds registry of that residence in the name of that natural person or his or her spouse or in their names jointly; or

 

(ii)     disposed of that residence to that trust by way of donation, settlement or other disposition or financed all the expenditure, as contemplated in paragraph 20, actually incurred by the trust to acquire and to improve the residence; and

 

(c)     that natural person alone or together with his or her spouse personally and ordinarily resided in that residence and used it mainly for domestic purposes as his or her or their ordinary residence from 11 February 2009 to the date of the registration contemplated in item (b)(i);

 

Provided that this paragraph applies only in respect of the portion of the property contemplated in paragraph 46.