24.     Base cost of asset of a person who becomes a resident on or after valuation date

 

(1)     The base cost of an asset, other than an asset situated in the Republic listed in paragraph 2(1)(b)(i) and (ii) or an asset held by a person if any amount received or accrued from the disposal of the asset would be taken into account for purposes of determining the net income as contemplated in section 9D of that person, acquired by a person before the date on which that person became a resident is the sum of the value of that asset determined in terms of subparagraphs (2) or (3) and the expenditure allowable in terms of paragraph 20 incurred on or after that date in respect of that asset.

 

(2)     Where an asset contemplated in paragraph 12(2) or (4) has been disposed of by a person on or after the date on which that person commenced to be a resident and the proceeds from that disposal and the expenditure allowable in terms of paragraph 20 incurred prior to that date (determined without regard to paragraph 12(2) or (4)) in respect of that asset are each lower than the market value of that asset as contemplated in paragraph 12(2) or (4), that person must be treated as having acquired that asset at a cost equal to the higher of-

 

(a)     the expenditure allowable in terms of paragraph 20 incurred in respect of that asset prior to that date; or

(b)     those proceeds less the expenditure allowable in terms of paragraph 20 incurred on or after that date in respect of that asset.

 

(3)     Where an asset contemplated in paragraph 12(2) or (4) has been disposed of by a person on or after the date on which that person commenced to be a resident and the proceeds from the disposal of that asset and the market value of that asset as contemplated in paragraph 12(2) or (4) are each lower than the expenditure allowable in terms of paragraph 20 incurred prior to that date (determined without regard to paragraph 12(2) or (4)) in respect of that asset, that person must be treated as having acquired that asset at a cost equal to the higher of-

 

(a)     that market value; or

(b)     those proceeds less the expenditure allowable in terms of paragraph 20 incurred on or after that date in respect of that asset.

 

(4)     The provisions of this paragraph do not apply in respect of any asset of a person who became a resident before 1 October 2001.