Page 133 - SAIT Compendium 2016 Volume1

s 12B INCOME TAX ACT 58 OF 1962 s 12B
the foundation or supporting structure shall be deemed to be a part of the machinery, plant, implement, utensil, article or improvement mounted thereon or af xed thereto. [Sub-s. (1) amended by s. 18 (b) of Act 17 of 2009 and
by s. 23 (1) of Act 22 of 2012 – date of commencement: 1 January 2013; this amendment (the addition of a proviso to sub-s. (1) applies in respect of years of assessment commencing on or after that date.]
[Sub-s. (1) amended by s. 18 (b) of Act 17 of 2009.]
(2) The deduction contemplated in subsection (1) shall be calculated on the cost to the taxpayer of the asset, as referred to in subsection (3), and the rate of the allowance
shall be—
(b) . . .
[Para. (b) deleted by s. 31 (b) of Act 31 of 2013 – date of
commencement: 12 December 2013.]
(c) any asset brought into use by any company during any year of assessment if such asset was previously brought into use by any other company during such year and both such companies are managed, controlled or owned by substantially the same persons, and a deduction under this section was previously granted
to such other company;
[Para. (c) substituted by s. 19 (1) (c) of Taxation Laws Amendment Act, 2015 (‘, section 12 (1) or section 27 (2) (d)’ deleted after ‘this section’) – date of commencement: date of promulgation of Taxation Laws Amendment Act, 2015.]
(d) any asset which has been disposed of by the taxpayer during any previous year of assessment;
(e) . . .
[Para. (e) added by s. 13 (1) (a) of Act 101 of 1990 and
deleted by s. 19 (f) of Act 31 of 2005.]
(f) any asset in respect of which an allowance has been
granted to the taxpayer under section 12E; or
[Para. (f) added by s. 7 (b) of Act 9 of 2005.]
(g) any asset the ownership of which is retained by the taxpayer as a seller in terms of an agreement contemplated in paragraph (a) of the de nition of ‘instalment credit agreement’ in section 1 of the
Value-Added Tax Act.
[Para. (g) added by s. 19 (h) of Act 31 of 2005 and substituted by s. 31 (c) of Act 31 of 2013 – date of commencement: 12 December 2013.]
(4A) . . .
[Sub-s. (4A) inserted by s. 13 (1) (b) of Act 101 of 1990, amended by s. 10 (1) of Act 113 of 1993 and by s. 6 (1) of Act 140 of 1993 and deleted by s. 21 of Act 35 of 2007.]
(4B) Where any asset in respect of which any deduction is claimed in terms of this section was during any previous nancial year brought into use for the rst time by the taxpayer for the purposes of any trade carried on by such taxpayer, the receipts and accruals of which were not included in the income of such taxpayer during such year, any deduction which could have been allowed in terms of this section during such previous year or any subsequent year that such asset was used by such taxpayer shall for the purposes of this section be deemed to have been allowed during such previous year or years as if the receipts and accruals of such trade had been included in the income of such taxpayer.
[Sub-s. (4B) inserted by s. 17 of Act 59 of 2000.]
(5) The deductions which may be allowed in terms of this section in respect of any asset shall not in the aggregate exceed the cost to the taxpayer of such asset.
(6) Where a lessor of any asset under a lease contemplated in subsection (4) (a) has within the period contemplated in subparagraph (ii) of that paragraph, reckoned from the commencement of the period for which the asset is let under that lease, disposed of the whole or a portion of that lessor’s interest in the lease or of his or her right to receive rent under the lease, there must be included in that lessor’s income for the year of assessment during which the disposal is made a sum equal to the aggregate of any deductions allowed to that lessor under this section, less a proportionate amount in respect of the expired portion of the lease or any portion of that interest or right which has not been disposed of by the lessor. [Sub-s. (6) substituted by s. 19 (i) of Act 31 of 2005 and by s. 19 (1) (d) of Taxation Laws Amendment Act, 2015 – date
of commencement: date of promulgation of Taxation Laws Amendment Act, 2015.]
(a)
in the case of an asset other than an asset contemplated in paragraph (b)—
(i) in respect of the year of assessment during which the asset is so brought into use, 50 per cent of such cost;
(ii) in respect of the second year, 30 per cent of such cost; and
(iii) in respect of the third year, 20 per cent of such cost;
[Para. (a) substituted by s. 19 (1) (b) of Taxation Laws Amendment Act, 2015 – date of commencement: 1 January 2016; the substitution applies iro years of assessment commencing on or after that date.]
in the case of an asset contemplated in subsection (1)
(b)
(c)
(h) (ii) (bb), 100 per cent of such cost; and
[Para. (b) substituted by s. 19 (1) (b) of Taxation Laws
Amendment Act, 2015 – date of commencement: 1 January 2016; the substitution applies iro years of assessment commencing on or after that date.]
Prelex
Wording of paras. (a) and (b) in force until 1 January 2016
(a) in respect of the year of assessment during which
the asset is so brought into use, 50 per cent of such
cost;
(b) in respect of the second year, 30 per cent of such
cost; and
in respect of the third year, 20 per cent of such cost. (3) For the purposes of this section the cost to a taxpayer of any asset acquired by that taxpayer shall be deemed to be the lesser of the actual cost to the taxpayer or the cost which a person would, if he or she had acquired the asset under a cash transaction concluded at arm’s length on the date on which the transaction for the acquisition of the asset was in fact concluded, have incurred in respect of the direct cost of acquisition of the asset, including the direct cost of the installation or erection thereof or, where the asset has been acquired to replace an asset which has been damaged or destroyed, such cost less any amount which has been recovered or recouped in respect of the damaged or destroyed asset and has been excluded from the taxpayer’s income in terms of section 8 (4) (e), whether
in the current or any previous year of assessment.
[Sub-s. (3) substituted by s. 19 (e) of Act 31 of 2005.] (4) No deduction shall be allowed under this section in
respect of—
(a) any asset which has been let by the taxpayer under
a lease other than an operating lease as de ned in section 23A (1), unless—
(i) the lessee under such lease derives in the carrying on of his trade amounts constituting income for the purposes of this Act; and
(ii) the period for which the asset is let under such lease is at least 5 years or such shorter period as is shown by the taxpayer to be the useful life of the asset;
SAIT CompendIum oF TAx LegISLATIon VoLume 1
125
INCOME TAX ACT – SECTIONS