Page 216 - SAIT Compendium 2016 Volume1

s 25BB INCOME TAX ACT 58 OF 1962 s 25BB
so much of any amount of tax proved to be payable by that trust to the government of a country other than the Republic as is attributable to the interest of that REIT or controlled company in that trust, without any right of recovery of that tax by any person,
must be allowed to be deducted by that REIT or controlled company before taking into account any deduction in terms of subsection (2) (a);
(b) there must be allowed as a deduction from the income of that REIT or that controlled company the sum of any taxes on income proved to be payable by that REIT or that controlled company to any sphere of government of any country other than the Republic, without any right of recovery by any person other than a right of recovery in terms of any entitlement to carry back losses arising during any year of assessment to any year of assessment prior to such year of assessment before taking into account any deduction in terms of subsection (2) (a); and
(c) where during any year of assessment a REIT or controlled company has made a bona de donation to any organisation as contemplated in section 18A (1) (a) or (b) there must be allowed to be deducted an amount equal to the amount of that donation: Provided that the deduction so allowed may not exceed 10 per cent of the taxable income of that REIT or controlled company after taking into account any deduction in terms of paragraphs (a) and (b) but before taking into account any deduction in terms of subsection (2) (a).
[Sub-s. (2A) inserted by s. 50 (1) (b) of Taxation Laws Amendment Act, 2015 – date of commencement:
1 January 2016; the inserted subsection applies iro years of assessment commencing on or after that date.]
(3) . . .
[Sub-s. (3) deleted by s. 50 (1) (c) of Taxation Laws Amendment Act, 2015 – date of commencement deemed to have been 1 April 2013; the retrospective deletion applies iro years of assessment commencing on or after that date.]
(a) immovable property of a company that is a REIT or controlled company at the time of the disposal;
[Para. (a) substituted by s. 45 (1) (c) of Act 43 of 2014 – date of commencement: 20 January 2015; the substitution applies iro years of assessment ending on or after that date.]
(b) a share or a linked unit in a company that is a REIT at the time of that disposal; or
(c) a share or a linked unit in a company that is a property company at the time of that disposal,
must be disregarded.
(6) (a) Any amount of interest received by or accrued
to a person during a year of assessment in respect of a debenture forming part of a linked unit held by that person in a company that is a REIT or a controlled company must if that company or controlled company is a resident be deemed to be a dividend received by or accrued to that person or if that company or controlled company is a foreign company be deemed to be a foreign dividend received or accrued to that person, during that year of assessment.
[Para. (a) substituted by s. 45 (1) (d) of Act 43 of 2014 (date of commencement deemed to have been 1 April 2013; the substitution applies iro years of assessment commencing on or after that date) and by s. 50 (1) (d) of Taxation Laws Amendment Act, 2015 – date of commencement deemed to have been 1 April 2013 as well; the paragraph, as retrospectively substituted, applies iro years of assessment commencing on or after that date.]
(b) Any amount of interest received by or accrued to a company that is a REIT or a controlled company that is a resident during a year of assessment in respect of a debenture forming part of a linked unit held by that company in a property company must if the property company is a resident be deemed to be a dividend, or if the property company is a foreign company be deemed to be a foreign dividend, received by or accrued to that company during that year of assessment if that company is a REIT or a controlled company that is a resident at the time of that receipt or accrual.
[Para. (b) substituted by s. 45 (1) (e) of Act 43 of 2014 (date of commencement deemed to have been 1 April 2013; the
substitution applies iro years of assessment commencing on or after that date) and by s. 50 (1) (d) of Taxation Laws Amendment Act, 2015 – date of commencement deemed to have been 1 April 2013 as well; the paragraph, as retrospectively substituted, applies iro years of assessment commencing on or after that date.]
Prelex
Wording of sub-s. (3) in force from 1 April 2013 until its retrospective deletion (by s. 50 (1) (c) of Taxation Laws Amendment Act, 2015) wef the same date
(3) (a) Any amount received by or accrued to a company that is a REIT or a controlled company on the last day of a year of assessment in respect of a nancial instrument must be included in the income of that company.
(b) Paragraph (a) does not apply to the disposal of a share or a linked unit in a company that is a REIT, a controlled company or a property company on the date of that disposal.
Prelex
Wording of paras. (a) and (b) in force from 1 April 2013 until the retrospective substitution thereof (by s. 50 (1) (d) of Taxation Laws Amendment Act, 2015) also wef that date
(6) (a) Any amount of interest received by or accrued to a person during a year of assessment in respect of a debenture forming part of a linked unit held by that person in a company that is a REIT or a controlled company must be deemed to be a dividend received by or accrued to that person during that year of assessment.
(b) Any amount of interest received by or accrued to a company that is a REIT or a controlled company that is a resident during a year of assessment in respect of a debenture forming part of a linked unit held by that company in a property company must be deemed to be a dividend if the property company is a resident or foreign dividend if the property company is a foreign company received by or accrued to that company during that year of assessment if that company is a REIT or a controlled company that is a resident at the time of that receipt or accrual.
(4) A company that is a REIT or a controlled company on the last day of a year of assessment may not deduct by way of an allowance any amount in respect of immovable property in terms of section 11 (g), 13, 13bis, 13ter, 13quat, 13quin or 13sex.
(5) In determining the aggregate capital gain or aggregate capital loss of a company that is a REIT or a controlled company on the last day of a year of assessment for purposes of the Eighth Schedule, any capital gain or capital loss determined in respect of the disposal of—
[Words in sub-s. (5) preceding para. (a) substituted by s. 45 (1) (b) of Act 43 of 2014 – date of commencement deemed to have been 1 April 2013 – the substitution applies iro years of assessment commencing on or after that date.]
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SAIT CompendIum oF TAx LegISLATIon VoLume 1