Page 730 - SAIT Compendium 2016 Volume2

BGR 7
INCOME Tax aCT: BINdINg gENERaL RuLINgS
BGR 8
Typewriters
6
Vending machines (including video game machines)
6
Video cassettes
2
Warehouse racking
10
Washing machines
5
Water distillation and puri cation plant
12
Water tankers
4
Water tanks
6
Weighbridges (movable parts)
10
Wire line rods
1
Workshop equipment
5
X-ray equipment
5
DATE: ACT: SECTION: SUBJECT:
Preamble
BINDING GENERAL RULING NO 8 (Issue 2): BGR 8 (2)
4 October 2012
INCOME TAX ACT 58 OF 1962 (the Act)
SECTION 1(1), DEFINITION OF ‘GROSS INCOME’
APPLICATION OF THE PRINCIPLES ENUNCIATED BY THE BRUMMERIA CASE
For the purposes of this ruling—
• ‘BGR’ means a binding general ruling issued under section 89 of the Tax Administration Act, 2011;
• ‘SCA’ means the Supreme Court of Appeal of South Africa;
• ‘section’ means a section of the Act unless otherwise stated;
• ‘Tax Administration Act, 2011’ means the Tax Administration Act 28 of 2011;
• ‘the Brummeria case’ means the judgment handed down by the SCA in Commissioner, SARS v Brummeria Renaissance
(Pty) Ltd 2007 (6) SA 601 (SCA), 69 SATC 205; and • ‘the Note’ means Interpretation Note 58 (Issue 2).
1. Purpose
is BGR reproduces paragraph 7 of Interpretation Note 58 (Issue 2) ‘ e Brummeria Case and the Right to Use Loan Capital Interest Free’ dated 4 October 2012, which comprises a BGR under section 89 of the Tax Administration Act, 2011.
2. Background
Issue 1 of the Note was issued on 30 June 2010 as a result of the judgment in the Brummeria case. Issue 2 of the Note substitutes references to section 76P with references to the Tax Administration Act, 2011 and updates the dates in the examples. e principles dealt with by the Note and hence in this BGR remain unchanged.
3. Ruling
Paragraph 7 of the Note, which comprises a BGR, is reproduced in the Annexure.
4. Period for which this ruling is valid
is BGR applies with e ect from the commencement of years of assessment ending on or a er 31 December 2008 and will apply for an inde nite period.
Group Executive, Interpretation and Rulings Legal, and Policy Division South African Revenue Service
ANNEXURE – PARAGRAPH 7 OF INTERPRETATION NOTE 58
7. Granting of life rights over units in a retirement village – Binding General Ruling (BGR)
e contents of this paragraph constitute a BGR under section 89 of the Tax Administration Act, 2011 and relate to the de nition of ‘gross income’ in section 1 (1). is BGR applies with e ect from the commencement of years of assessment ending on or a er 31 December 2008 and will apply for an inde nite period.
722 SAIT CompendIum oF TAx LegISLATIon VoLume 2