Page 128 - SAIT Compendium 2016 Volume2

PN 4/1999 Income Tax acT: PracTIce noTes
PN 4/1999
ALTERNATIVE 2 Loan ($200 000)
Ruling exchange rates:
Date of previous translation (31-12-1995)
Date of deemed realisation (30-06-1996)
(See calculation 1)
Exchange difference:
[(3,6000 – 3,7467) x $200 000]
Loan (£133 333)
Ruling exchange rates:
Transaction date (30-06-1996)
Date of translation (31-12-1996)
Exchange difference:
[(5,6200 – 5,6600) x $133 333]
Portion of exchange difference deductible from income in the 1996 year of assessment
[(- R9 000 – R29 333 – R5 333) x 10%]
Deferred amount of exchange difference to be deducted in following years [R43 666 – R4 367]
ALTERNATIVE 3 Loan ($200 000)
Ruling exchange rates:
Date of previous translation (31-12-1995)
Date of deemed realisation (30-06-1996)
Exchange difference:
[(3,6000 – 3,7500) x $200 000]
3,6000 3,7467
5,6200 5,6600
R29 333 loss
R5 333 loss R4 367 loss
R39 299 loss
R30 000 loss
3,6000 3,7500
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SAIT CompendIum oF TAx LegISLATIon VoLume 2