Page 27 - Juta's Indirect Tax

s 1 VALUE-ADDED TAX ACT 89 OF 1991 s 2
(e) conservation, environment and animal welfare. [De nition of ‘welfare organisation’ substituted by s. 21 (e) of Act 136 of 1991, by GN 2695 of 8 November 1991, by s. 12
(1) (o) of Act 136 of 1992, by s. 81 (1) (g) of Act 53 of 1999 and by s. 148 (1) (h) of Act 60 of 2001, amended by s. 114 (1) (c) of Act 74 of 2002, substituted by s. 92 (1) (m) of Act 32 of 2004 and amended by s. 77 (e) of Act 20 of 2006.]
[Sub-s. (1), previously s. 1, renumbered by s. 271 of Act 28 of 2011 – date of commencement: 1 October 2012.]
(2) Unless the context indicates otherwise, a word or expression to which a meaning has been assigned in the Tax Administration Act bears that meaning for purposes of this Act.
[Sub-s. (2) added by s. 271 of Act 28 of 2011 – date of commencement: 1 October 2012.]
2 Financial services
(1) For the purposes of this Act, the following activities shall be deemed to be nancial services:
(a) The exchange of currency (whether effected by
services to the extent that the consideration payable in respect thereof is any fee, commission, merchant’s discount or similar charge, excluding any discounting cost. [Sub-s. (1) amended by s. 19 (1) (g) of Act 37 of 1996 and by s. 87 (1) (a) of Act 30 of 1998.]
(2) For the purposes of subsection (1)—
‘cheque’ means a bill drawn on a bank payable on demand, a postal order, a money order, a traveller’s cheque, or any order or authorisation (whether in writing, by electronic means, or otherwise) to a nancial institution to credit or debit any account;
[De nition of ‘cheque’ substituted by s. 10 (1) (c) of Act 20 of 1994 and by s. 93 (b) of Act 32 of 2004.]
‘currency’ means any banknote or other currency of any country, other than when used as a collector’s piece, investment article, item of numismatic interest, or otherwise than as a medium of exchange;
‘debt security’ means—
(aa) an interest in or right to be paid money; or
(bb) an obligation or liability to pay money,
that is, or is to be, owing by any person, but does not include a cheque;
[De nition of ‘debt security’ substituted by s. 149 of Act 60 of 2001.]
‘derivative’ means a derivative as de ned in International Accounting Standard 39 of the international Accounting Standards issued by the International Accounting Standards Board;
[De nition of ‘derivative’ inserted by s. 93 (c) of Act 32 of 2004 and substituted by s. 130 (1) (a) of Act 24 of 2011 – date of commencement: 10 January 2012.]
‘equity security’ means any interest in or right to a share in the capital of a juristic person or the interest in a close corporation of a member thereof;
‘long-term insurance policy’ means any policy of insurance issued in the ordinary course of carrying on long-term insurance business as de ned in section 1 (1) of the Long-term Insurance Act, 1998 (Act 52 of 1998);
[De nition of ‘long-term insurance policy’, formerly de nition of ‘life insurance policy’, substituted by s. 22 (a) of Act 136 of 1991, by s. 19 (1) (h) of Act 37 of 1996 and by s. 82 (b) of Act 53 of 1999.]
‘merchant’s discount’ means a charge made to merchants for accepting a credit or debit card as payment for the supply of goods or services, or a similar charge made by a buying organisation;
[De nition of ‘merchant’s discount’ inserted by s. 87 (1) (b) of Act 30 of 1998.]
‘participatory security’ means a participatory interest as de ned in section 1 of the Collective Investment Schemes Control Act, 2002 (Act 45 of 2002), but does not include an equity security, a debt security, money or a cheque;
[De nition of ‘participatory security’ substituted by s. 115 of Act 74 of 2002 and by s. 78 of Act 20 of 2006.]
‘superannuation scheme’ means a scheme whereby provision is made for the payment or granting of bene ts by a bene t fund, pension fund, pension preservation fund, provident fund, provident preservation fund or retirement annuity fund as de ned in section 1 of the Income Tax Act.
[De nition of ‘superannuation scheme’ substituted by s. 10 (1) (d) of Act 20 of 1994 and by s. 130 (1) (b) of Act 24 of 2011 – date of commencement: 10 January 2012.]
(3) Notwithstanding subsection (2), the terms ‘debt security’, ‘equity security’ and ‘participatory security’ do not include any of the following:
(a) A long-term insurance policy or any other policy of
insurance;
[Para. (a) substituted by s. 19 (1) (i) of Act 37 of 1996.] 19
(b) (c) (d) (e) (f)
the exchange of bank notes or coin, by crediting or debiting accounts, or otherwise);
the issue, payment, collection or transfer of ownership of a cheque or letter of credit;
the issue, allotment, drawing, acceptance, endorsement or transfer of ownership of a debt security;
the issue, allotment or transfer of ownership of an equity security or a participatory security;
.. .
[Para. (e) deleted by s. 19 (1) (a) of Act 37 of 1996.]
the provision by any person of credit under an agreement by which money or money’s worth is provided by that person to another person who agrees to pay in the future a sum or sums exceeding in the aggregate the amount of such money or money’s worth;
[Para. (f) substituted by s. 19 (1) (b) of Act 37 of 1996.]
(g) and (h) . . .
[Paras. (g) and (h) deleted by s. 19 (1) (c) of Act 37 of 1996.]
(i)
(j)
the provision, or transfer of ownership, of a long-term insurance policy or the provision of reinsurance in respect of any such policy: Provided that such an activity shall not be deemed to be a nancial service to the extent that it includes the management of a superannuation scheme;
[Para. (i) substituted by s. 19 (1) (d) of Act 37 of 1996.] the provision, or transfer of ownership, of an interest in a superannuation scheme;
[Para. (j) substituted by s. 19 (1) (e) of Act 37 of 1996.] (k) the buying or selling of any derivative or the granting of an option: Provided that where a supply of the underlying goods or services takes place, that supply shall be deemed to be a separate supply of goods or services at the open market value thereof: Provided further that the open market value of those goods or services shall not be deemed to be consideration for a
nancial service as contemplated in this paragraph:
[Para. (k) substituted by GN 2695 of 8 November 1991, by s. 13 (1) (a) of Act 136 of 1992 and by s. 82 (a) of Act 53 of 1999 and amended by s. 93 (a) of Act 32 of 2004 and by s. 41 of Act 9 of 2006.]
(l) . . .
[Para. (l) deleted by s. 44 of Act 16 of 2004.]
(m) . . .
[Para. (m) deleted by s. 10 (1) (a) of Act 20 of 1994.]
(n) . . .
[Para. (n) substituted by s. 10 (1) (b) of Act 20 of 1994 and
deleted by s. 19 (1) (f) of Act 37 of 1996.] Provided that the activities contemplated in paragraphs (a), (b), (c), (d) and (f) shall not be deemed to be nancial
Juta’s IndIrect tax 2016
VALUE-ADDED TAX ACT