Page 491 - Juta's Indirect Tax

IN 82 VaLue-added tax act: InterPretatIOn nOtes IN 82
Provided that—
(i) paragraph (b) of this subsection shall not apply where a vendor has, only as a result of not complying with
the provisions of section 16(2), not been entitled to make a deduction of input tax in terms of section 16(3);
(ii) deleted;
(iii) deleted;
(iv) this subsection shall not apply where a constitutional institution listed in Schedule 1 or a public entity
listed in Part A or C of Schedule 3 to the Public Finance Management Act, 1999 (Act No. 1 of 1999), is re- classi ed within the Schedules to the Public Finance Management Act, 1999 (Act No. 1 of 1999) and applies those goods or services for the purposes of consumption, use or supply in the course of making taxable supplies; or
(v) this subsection shall not apply where a municipality applies goods or services acquired before 1 July 2006 for the purposes of consumption, use or supply in the course of making taxable supplies on or after 1 July
2006.
.. .
(9) Where a vendor has acquired or imported a motor car (in respect of which input tax has been denied in terms of section 17 (2) (c)) and has subsequently converted that motor car into a game viewing vehicle or a hearse, as contemplated in paragraph (e) or (f) of the de nition of ‘motor car’ in section 1, that motor car is deemed to be supplied in that tax period to that vendor, and the Commissioner shall allow that vendor to make a deduction in terms of section 16(3) of an amount equal to the tax fraction of the lesser of—
(a) the adjusted cost; or
(b) the open market value,
of that motor car on the day before that conversion: Provided that this deduction excludes any amount of input tax which quali es or has quali ed for a deduction under another provision of this Act.
Annexure B – Government Gazette No. 13651
Government Gazette 13651
Notice No: 2835
Directions for purposes of section 10(8) and (13)
I, Barend Jacobus du Plessis, Minister of Finance, hereby prescribe in terms of subsections (8) and (13) of section 10
of the Value-Added Tax Act, 1991 (Act No. 89 of 1991), that the consideration in money for the supplies contemplated in the said paragraphs be determined in the manner as set out in the Schedule.
Schedule
(1) In this Schedule, any word or expression to which a meaning has been assigned in the Act, bears the meaning so assigned thereto, and, unless the context otherwise indicates –
‘determined value’, in relation to a motor vehicle, means –
(a) where a motor vehicle, except a motor vehicle contemplated in paragraph (b)(ii) of this de nition was acquired
by a vendor under an agreement of sale or exchange concluded by parties acting at arms’ length, the original cost
thereof to him, excluding any nance charges, interest, sales tax or value-added tax; or
(b) where such motor vehicle –
(i) is held by the vendor under a lease; or
(ii) was held by the vendor under a lease and the ownership thereof was acquired by him on the termination
of the lease,
the retail market value thereof at the time the vendor rst obtained the right of use of the motor vehicle or, where at such time such lease was a nancial lease for the purposes of the Sales Tax Act, 1978 (Act No. 103 of 1978), the cash value thereof as contemplated in paragraph 2 of Schedule 4 of that Act, or, where at such time such lease was an instalment credit agreement as contemplated in section 1 of the Act, the cash value thereof as de ned in section 1 of the Act reduced by the amount of value-added tax; or
(c) where such vehicle was acquired otherwise than contemplated in paragraphs (a) or (b), the market value of such motor vehicle at the time when the vendor rst obtained the vehicle or right of use thereof:
Provided that where an employee has been granted the right of use of such motor vehicle and such vehicle, or the right of use thereof, was acquired by the vendor not less than 12 months before the date on which the employee was granted such right of use, there shall be deducted from the amount so determined under the aforegoing provisions of this de nition a depreciation allowance calculated according to the reducing balance method at the rate of 15 per cent for each completed period of 12 months from the date on which the vendor rst obtained such vehicle or the right of use thereof to the date on which the said employee was rst granted the right of use thereof; and
‘the Act’ means the Value-Added Tax Act, 1991 (Act No. 89 of 1991).
(2) (a) For the purposes of the proviso to subsection (8) of section 10 of the Act, the consideration in money for the deemed supply shall be 0,3 per cent of the determined value of the motor vehicle for each month or part thereof calculated as from 1 October 1991.
22 November 1991
Juta’s IndIrect tax 2016 483