Page 135 - SAIT Compendium 2016 Volume1

s 12C INCOME TAX ACT 58 OF 1962 s 12C
used by the lessee in a hotel, except any vehicle or equipment for of ces or managers’ or servants’ rooms;
[Para. (e) substituted by s. 20 (b) of Act 31 of 2005 and by s. 32 (1) (a) of Act 31 of 2013 – date of commencement: 12 December 2013.]
(f) aircraft owned by the taxpayer or acquired by the taxpayer as purchaser 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 and which was or is brought into use for the rst time by the taxpayer for the purposes of his or her trade (other than an aircraft in respect of which an allowance has been granted to the taxpayer under section 12B);
[Para. (f) added by s. 13 (1) (b) of Act 21 of 1995 and substituted by s. 20 (b) of Act 31 of 2005, by s. 32 (1) (a) of Act 31 of 2013 (date of commencement: 12 December 2013) and by s. 32 (1) (b) of Act 31 of 2013 — date of commencement: 1 April 2014; the substituted paragraph applies in respect of years of assessment commencing on or after that date.]
(g) ship owned by the taxpayer or acquired by the taxpayer as purchaser 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 and which was or is brought into use for the rst time by the taxpayer for the purposes of his or her trade (other than a South African ship contemplated in section 12Q (1));
[Para. (g) added by s. 13 (1) (b) of Act 21 of 1995 and substituted by s. 20 (b) of Act 31 of 2005, by s. 32 (1) (a) of Act 31 of 2013 (date of commencement: 12 December 2013) and by s. 32 (1) (b) of Act 31 of 2013 — date of commencement: 1 April 2014; the substituted paragraph applies in respect of years of assessment commencing on or after that date.]
(gA) new or unused machinery or plant, which is owned by a taxpayer, or acquired by a taxpayer as purchaser 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 and is rst brought into use by that taxpayer for purposes of research and development as de ned in section 11D; or
[Para. (gA) inserted by s. 33 (1) (a) of Act 24 of 2011 and substituted (by deleting by s. 32 (1) (a) of Act 31 of 2013 – date of commencement: 12 December 2013.]
(h) improvement (other than repairs) to any machinery, plant, implement, utensil or article referred to in paragraph (a), (b), (c), (d), (e) or (gA) which is during the year of assessment used as contemplated in that paragraph,
[Para. (h) inserted by s. 19 (a) of Act 17 of 2009 and substituted by s. 33 (1) (b) of Act 24 of 2011 – date of commencement: 1 April 2012. The substituted paragraph applies in respect of expenditure incurred in respect of research and development on or after 1 April 2012 but before 1 April 2022.]
a deduction equal to 20 per cent of the cost to that taxpayer to acquire that machinery, plant, implement, utensil, article, ship, aircraft or improvement (hereinafter referred to as the asset) shall be allowed in the year of assessment during which the asset is so brought into use and in each of the four succeeding years of assessment: Provided that where—
[Words in sub-s. (1) following para. (h) and preceding the proviso substituted by s. 24 (1) (a) of Act 22 of 2012 – date of commencement deemed to have been 1 April 2012; the substituted wording applies in respect of expenditure incurred in respect of research and development on or after that date.]
(a) . . .
[Para. (a) deleted by s. 32 (1) (c) of Act 31 of 2013 – date of
commencement: 12 December 2013.]
(b) . . .
[Para. (b) omitted by s. 19 (b) of Act 17 of 2009.]
(c) any new or unused machinery or plant referred to in paragraph (a) of this subsection or improvement referred to in paragraph (h) of this subsection, is or was—
(i) acquired by the taxpayer under an agreement formally and nally signed by every party to the agreement on or after 1 March 2002; and
(ii) brought into use by the taxpayer on or after that date in a process of manufacture or process which is of a similar nature, carried on by that taxpayer in the course of its business (other than banking, nancial services, insurance or rental business),
[Sub-para. (ii) substituted by s. 20 (1) (c) of Taxation
Laws Amendment Act, 2015 (‘in the opinion of the Commissioner’ deleted before ‘is of a similar nature,’) – date of commencement: date of promulgation of Taxation Laws Amendment Act, 2015.]
(d)
the deduction under this subsection shall be increased to 40 per cent of the cost to that taxpayer of that machinery, plant or improvement in respect of the year of assessment during which the plant, machinery or improvement was or is so brought into use for the rst time and shall be 20 per cent in each of the three subsequent years of assessment; and
any new or unused machinery or plant referred to in paragraph (gA) of this subsection or improvement referred to in paragraph (h) of this subsection, is or was—
(i) acquired by the taxpayer under an agreement formally and nally signed by every party to the agreement on or after 1 January 2012; and
(ii) brought into use by the taxpayer on or after that date for the purpose of research and development as de ned in section 11D,
the deduction under this subsection shall be— (aa)increased to 50 per cent of the cost to that taxpayer of that machinery, plant or improvement in respect of the year of assessment during which the plant, machinery or improvement is or was so
brought into use for the rst time;
(bb)30 per cent of that cost in the year of assessment immediately succeeding the year of assessment contemplated in item (aa); and (cc) 20 per cent of that cost in the year of assessment immediately succeeding the year
of assessment contemplated in item (bb): [Para. (d) added by s. 33 (1) (c) of Act 24 of 2011 and
substituted by s. 32 (1) (d) of Act 31 of 2013 – date of commencement: 12 December 2013.]
Provided further that where any machinery, plant, implement, utensil, article or improvement qualifying for an allowance under this section is mounted on or af xed to any concrete or other foundation or supporting structure— [Words in sub-s. (1) preceding para. (a) of the further proviso substituted by s. 24 (1) (b) of Act 22 of 2012 –
date of commencement: 1 January 2013; the substituted wording applies in respect of years of assessment commencing on or after that date.]
(a) the foundation or supporting structure is designed for such machinery, plant, implement, utensil, article or improvement and constructed in such manner that it is or should be regarded as being integrated with the machinery, plant, implement, utensil, article or improvement; and
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INCOME TAX ACT – SECTIONS