Page 335 - SAIT Compendium 2016 Volume2

IN 18 (3) Income Tax acT: InTeRPReTaTIon noTes
IN 18 (3)
Less:
Retirement annuity fund contributions Section 11(n)(i)(aa) –
Actual contributions R15 000 Limited to the greater of:–
i) R1 750;
ii) R3 500 – R15 000 = RNil; or
iii) 15% of non-retirement funding employment income
= (R362 387 – R200 000) × 15%
= R162 387 × 15%
= R24 358
Limited to the actual contributions of R15 000
Apportionment of R15 000:
(R282 200 / R347 387 × R15 000) = R12 185 (R65 187 / R347 387 × R15 000) = R2 815
Taxable income before the deduction of donations
Less:
Donation to public bene t organisation Section 18A –
Actual donation R1 500
Limited to 10% of R332 387 = R33 239
Thus the full R1 500 may be deducted. Apportionment of R1 500: (R270 015 / R332 387 × R1 500) = R1 219
(R62 372 / R332 387 × R1 500) = R281
Taxable income
(b) Calculation of normal tax before rebates
Normal tax payable: (Rates of tax – 2015 year of assessment)
On R272 700
On R58 187
[(R330 887 taxable income – R272 700 per tax table) × 30%] Total
(12 185)
270 015
(1 219)
268 796
(2 815)
62 372
(281)
62 091
(15 000)
332 387
(1 500)
330 887
R
55 957
17 456,10 73 413,10
R
20 000
8 800 28 800
(c) Sum of qualifying foreign taxes which relate to total taxable foreign income
Foreign taxes payable in respect of foreign dividends (Note 1) Foreign taxes payable in respect of foreign interest
Foreign taxes paid which relate to total taxable foreign income
Note 1: Under paragraph (ii) of the proviso to section 6quat(1A) the amount of foreign taxes attributable to the exempt foreign dividends of R35 313 potentially quali es for the foreign tax rebate under section 6quat(1).
• Calculation of the section 6quat rebate Amount of foreign taxes that qualify for the rebate
Limited to [see (d)]
(d) Calculation of the section 6quat limitation
Taxable income derived from all foreign sources _______________________________________ × Normal tax
Total taxable income derived from all sources
_R__6_2_0__9_1_ × R73 413,10 R330 887
= R13 775,98
Note:
R
28 800,00
13 775,98
The amount of the limitation is less than the sum of qualifying foreign taxes of R28 800 as calculated above. Thus the section 6quat rebate for the 2015 year of assessment is limited to R13 775,98 while the balance of R15 024,02 (R28 800,00 – R13 775,98) may be carried forward to the 2016 year of assessment to be used in determining the foreign tax rebate for that year of assessment.
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