Section 8A (STT Act) – Sharia compliant financing arrangements

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8A.      Sharia compliant financing arrangements

(1)     In the case of any murabaha as defined in section 24JA(1) of the Income Tax Act, 1962 (Act No. 58 of 1962)-

(a)     the financier shall be deemed not to have acquired any beneficial ownership of the security under the sharia arrangement; and

(b)     the client shall be deemed to have acquired beneficial ownership of the security from the seller-

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

(ii)     at such time as the financier acquired the beneficial ownership of the security from the seller by virtue of the transaction between the seller and the financier.

[Section 8A inserted by section 128 of Act 7 of 2010 effective on 1 January 2013 and substituted by section 149 of Act 24 of 2011 effective on 1 January 2013]

Section 3A (Transfer Duty Act) – Sharia compliant financing arrangements

Posted on by admin_kmos

3A.      Sharia compliant financing arrangements

 

(1)     For the purpose of the payment of duty in respect of any murabaha as defined in section 24JA(1) of the Income Tax Act, 1962 (Act No. 58 of 1962)-

 

(a)     the financier shall be deemed not to have acquired any property under the sharia arrangement; and

[Paragraph (a) substituted by section 3 of Act 24 of 2011 effective on 1 January 2013]

(b)     the client shall be deemed to have acquired property from the seller-

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

(ii)     at such time as the financier acquired the property from the seller by virtue of the transaction between the seller and the financier.

[Paragraph (b) substituted by section 3 of Act 24 of 2011 effective on 1 January 2013]

 

(2)     For the purpose of the payment of the duty in respect of any diminishing musharaka as defined in section 24JA(1) of the Income Tax Act, 1962 (Act No. 58 of 1962)-

 

(a)     the bank shall be deemed not to have acquired any property under the sharia arrangement;

(b)

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

(aa)   for an amount equal to the amount paid by the bank in respect of the bank’s interest in the property; and

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

(ii)     where the bank acquires an interest in property from the client, the bank shall be deemed not  to have acquired any interest in property from the client and the client shall be deemed not to have subsequently acquired any interest in that property from the bank.

 

(3)     For the purpose of the payment of duty in respect of any sukuk as defined in section 24JA(1) of the Income Tax Act, 1962 (Act No. 58 of 1962), the trust shall be deemed not to have acquired the asset from the government of the Republic.

[Subsection (3) substituted by section 3 of Act 24 of 2011 effective on 1 January 2013]

[Section 3A inserted by section 2 of Act 7 of 2010 effective on 1 January 2013]