Page 163 - SAIT Compendium 2016 Volume1

s 13quat INCOME TAX ACT 58 OF 1962 s 13quin
(d) The area demarcated in terms of subsection (6) may exceed the limits contemplated in paragraph (a) where—
(i) the municipality proves to the Minister that the excess area is integrally related to the area within the limitation contemplated in paragraph (a);
(ii) the municipality can prove to the Minister that sound economic reasons exist for demarcating a larger area; and
(iii) . . .
[Sub-para. (iii) deleted by s. 29 (1) (h) of Act 60 of 2008.] (iv) the Minister is satis ed that the demarcation of the excess area would fall within Government’s
affordability constraints.
(8) The Minister must publish by notice in the Gazette
particulars of an area demarcated by a municipality after that municipality has proved to the Minister that the area so demarcated complies with the provisions of subsection (6).
(9) Every municipality must provide a report annually to the Commissioner and the Minister in respect of each urban development zone located within that municipality containing such information, within such time* and in such manner as is prescribed by the Minister.
[Sub-s. (9) amended by s. 19 (1) (d), (e) and (f) of Act 32 of 2004 and by s. 23 (l) of Act 31 of 2005 and substituted by s. 29 (1) (i) of Act 60 of 2008.]
(10) Where—
(a) a municipality does not provide an annual report as
contemplated in subsection (9) or the Commissioner reports to the Minister that the municipality has issued a certi cate contemplated in subsection (4) (a) in respect of a building that is located outside an urban development zone; and
[Para. (a) substituted by s. 33 (1) (c) of Act 7 of 2010.] (b) corrective steps are not taken by that municipality
within a period speci ed by the Minister,
the Minister may withdraw the notice contemplated in subsection (8) for that municipality in respect of contracts formally and nally signed by all parties thereto on or after the date of withdrawal.
(10A) Every developer who erects, extends, adds to or improves any building within an urban development zone must, if the estimated cost of that erection, extension, addition or improvement is likely to exceed R5 million— (a) inform the Commissioner within 30 days after
commencement of the erection, extension, addition or improvement of the estimated costs thereof in respect of the building or the parts which the developer intends to sell and the estimated selling price of that building or those parts; and
(b) inform the Commissioner within 30 days after sale of the building or all anticipated sales of any parts of the building have been concluded of the actual costs incurred in respect of that building or parts and the actual selling price of that building or parts thereof.
[Sub-s. (10A) inserted by s. 23 (m) of Act 31 of 2005 and amended by s. 2 (2) (b) of Act 8 of 2007 and by s. 1 (2) (c) of Act 3 of 2008.]
(10B) If the Commissioner has reason to believe that the information provided in the certi cate by a developer as contemplated in subsection (4) (d) (iii) is not correct, the
Commissioner must disallow any deduction claimed under this section, unless suf cient information is provided to the Commissioner to prove that the information contained in that certi cate is correct.
[Sub-s. (10B) inserted by s. 23 (m) of Act 31 of 2005.] (11) The Commissioner must on an annual basis submit a report to the Minister containing information relating
to—
(a) the number of taxpayers which have during the
relevant year claimed an allowance in terms of this
section;
(b) the total amount of the deductions by taxpayers
allowed in that year in terms of this section; and
(c) the total amount of the costs to those taxpayers which are or will be allowable as a deduction in terms of this
section.
[S. 13quat inserted by s. 33 of Act 45 of 2003.]
13quin Deduction in respect of commercial buildings
(1) There shall be allowed to be deducted from the income of the taxpayer an allowance equal to ve per cent of the cost to the taxpayer of any new and unused building owned by the taxpayer, or any new and unused improvement to any building owned by the taxpayer, if that building or improvement is wholly or mainly used by the taxpayer during the year of assessment for purposes of producing income in the course of the taxpayer’s trade, other than the provision of residential accommodation.
(1A) For the purposes of this section, if a taxpayer completes an improvement as contemplated in section 12N, the expenditure incurred by the taxpayer to complete the improvement shall be deemed to be the cost to the taxpayer of any new and unused building or of any new and unused improvement to a building contemplated in subsection (1).
[Sub-s. (1A) inserted by s. 34 (1) (b) of Act 7 of 2010.] (2) For the purposes of this section the cost to a taxpayer of any building or improvement shall be deemed to be the lesser of the actual cost to the taxpayer or the cost which a person would, if he had acquired, erected or improved the building under a cash transaction concluded at arm’s length on the date on which the transaction for the acquisition, erection or improvement of the building was in fact concluded, have incurred in respect of the direct cost of the acquisition, erection or improvement of the
building.
(3) Where any building or improvement 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 year or any subsequent year in which such asset was used by the 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.
*Time period within which every municipality must provide a report for each urban development zone located within that municipality to the Commissioner of the South African Revenue Service and the Minister of Finance prescribed as follows: 1. in respect of each nancial year of a municipality ending on or before 30 June 2007, by 28 September 2007; and 2. in respect of each nancial year of a municipality ending on or after 30 June 2008, within 3 months after the end of
such year—
GN 682 in GG 30102 of 27 July 2007.
SAIT CompendIum oF TAx LegISLATIon VoLume 1 155
INCOME TAX ACT – SECTIONS