Page 190 - Juta's Indirect Tax

s 1 SECURITIES TRANSFER TAX ACT 25 OF 2007 s 1
‘lending arrangement’ means any arrangement in terms of which—
(a) a person (hereinafter referred to as the lender) lends a
listed security to another person (hereinafter referred to as the borrower) in order to enable that borrower to effect delivery (other than to any lender in relation to that borrower, unless the borrower can demonstrate that the arrangement was not entered into for the purposes of the avoidance of tax and was not entered into for the purposes of keeping any position open for more than 12 months) of that security within 10 business days after the date of transfer of that security from the lender to the borrower in terms of that arrangement;
(b) that borrower in return contractually agrees in writing to deliver an identical security, as de ned in section 1 of the Income Tax Act, to that lender within a period of 12 months from the date of transfer of that listed security from the lender to the borrower;
[Para. (b) substituted by s. 137 (1) (b) of Taxation Laws Amendment Act, 2015 – date of commencement:
1 January 2016; this substitution applies iro any lending arrangement entered into on or after that date.]
(c) that borrower is contractually required to compensate that lender for any distributions in respect of the listed security (or a security in a resultant company acquired by virtue of a listed security held in an amalgamated company as contemplated in section 44 (6) of the Income Tax Act) which that lender would have been entitled to receive during that period had that arrangement not been entered into; and
[Para. (c) substituted by s. 137 (1) (b) of Taxation Laws Amendment Act, 2015 – date of commencement:
1 January 2016; this substitution applies iro any lending arrangement entered into on or after that date.]
(d) that arrangement does not affect the lender’s bene ts or risks arising from uctuations in the market value of the listed security (or a security in a resultant company acquired by virtue of a listed security held in an amalgamated company as contemplated in section 44 (6) of the Income Tax Act),
[Para. (d) substituted by s. 137 (1) (b) of Taxation Laws Amendment Act, 2015 – date of commencement:
1 January 2016; this substitution applies iro any lending arrangement entered into on or after that date.]
[Sub-para. (ii) substituted by s. 137 (1) (c) of Taxation Laws Amendment Act, 2015 (‘listed security’ replaced by ‘identical security’) – date of commencement: 1 January 2016; this substitution applies iro any lending arrangement entered into on or after that date.]
‘listed security’ means any security that is listed on an exchange;
‘listed share’ means any share or depositary receipt in a company that is listed on an exchange;
[De nition of ‘listed share’ inserted by s. 137 (1) (d)
of Taxation Laws Amendment Act, 2015 – date of commencement: date of promulgation of Taxation Laws Amendment Act, 2015.]
‘lowest price’ means the lowest price, on the date of the transaction or other manner of acquisition of a listed security, at which that security was traded on the exchange on which it is listed, as determined by that exchange on each day on which trade in that security occurs on that exchange: Provided that where that security was not traded on the date of the transaction or other manner of acquisition, the lowest price of that security must be regarded as being the lowest price on the last business day, preceding the date of the transaction or other manner of acquisition, on which that security was traded on that exchange;
‘member’ means any person who is an ‘authorised user’ as de ned in section 1 of the Financial Markets Act providing such security services as the rules of the exchange permit including services in respect of the buying and selling of a listed security; and
[De nition of ‘member’ substituted by s. 110 (1) (d) of Act 43 of 2014 – substitution deemed to have come into operation on 3 June 2013.]
‘Minister’ means the Minister of Finance;
‘participant’ means a person that holds in custody and administers a listed security or an interest in a listed security and that has been authorised in accordance with section 31 of the Financial Markets Act by a central securities depository as a participant in that central securities depository;
[De nition of ‘participant’ substituted by s. 110 (1) (e) of Act 43 of 2014 – substitution deemed to have come into operation on 3 June 2013.]
‘person’ includes—
(a) any sphere of the Government of the Republic;
(b) any body of persons (incorporated or unincorporated); (c) the estate of any deceased or insolvent person;
(d) any trust fund; and
(e) any portfolio comprised in any collective investment
scheme in securities contemplated in Part IV of the Collective Investment Schemes Control Act, 2002 (Act 45 of 2002);
‘prescribed rate’, in relation to any interest payable in terms of the Securities Transfer Tax Administration Act, 2007, means such rate as the Minister may x from time to time by notice in the Gazette in terms of section 80 (1) (b) of the Public Finance Management Act, 1999 (Act 1 of 1999): Provided that where the Minister xes a new rate in terms of that Act, that new rate applies for the purposes of the Securities Transfer Tax Administration Act, 2007, from the rst day of the second month following the date on which that new rate came into operation;
‘Republic’ means the ‘Republic’ as de ned in section 1 of the Income Tax Act;
‘security’ means—
(a) any share or depository receipt in a company; or (b) any member’s interest in a close corporation, (c) . . .
[Para. (c) deleted by s. 145 (1) (c) of Act 24 of 2011.]
excluding the debt portion in respect of a share linked to a debenture;
Prelex
Wording of paras. (b), (c) and (d) in force until 1 January 2016
(b) that borrower in return contractually agrees in writing
to deliver a listed security of the same kind and quality to that lender within a period of 12 months from the date of transfer of that security from the lender to the borrower in terms of that arrangement;
(c) that borrower is contractually required to compensate that lender for any distributions in respect of the listed security which that lender would have been entitled to receive during that period had that arrangement not been entered into; and
(d) that arrangement does not affect the lender’s bene ts or risks arising from uctuations in the market value of the listed security,
but does not include an arrangement where the borrower has not—
(i) on-delivered the listed security within the period referred to in paragraph (a); or
(ii) returned the identical security contemplated in paragraph (b) to the lender within the period referred to in that paragraph;
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Juta’s IndIrect tax 2016