Page 228 - SAIT Compendium 2016 Volume1

s 29A
INCOME TAX ACT 58 OF 1962 s 29A
s. 77 (1) (h) of Act 31 of 2013 – deletion deemed to have come into operation on 1 January 2013 and applies in respect of years of assessment commencing on or after that date.]
(11B) . . .
[Sub-s. (11B) inserted by s. 15 (1) (g) of Act 5 of 2001 and deleted by s. 77 (1) (h) of Act 31 of 2013 – deletion deemed to have come into operation on 1 January 2013 and applies in respect of years of assessment commencing on or after that date.]
(11C) . . .
[Sub-s. (11C) inserted by s. 15 (1) (g) of Act 5 of 2001 and deleted by s. 77 (1) (h) of Act 31 of 2013 – deletion deemed to have come into operation on 1 January 2013 and applies in respect of years of assessment commencing on or after that date.]
(12) In the allocation of any receipt, accrual, asset, expenditure or liability to any fund contemplated in subsection (4), an insurer shall, when establishing such fund and at all times thereafter—
(a) to the extent to which such receipt, accrual, asset, expenditure or liability relates exclusively to business conducted by it in any one fund, allocate such receipt, accrual, asset, expenditure or liability to that fund; and
(b) to the extent to which such receipt, accrual, asset, expenditure or liability does not relate exclusively to business conducted by it in any one fund, allocate such receipt, accrual, asset, expenditure or liability in a manner which is consistent with and appropriate to the manner in which its business is conducted.
[Sub-s. (12) substituted by s. 47 (1) (t) of Act 43 of 2014 –
date of commencement: 1 January 2016; the substituted paragraph applies iro years of assessment commencing on or after that date.]
Prelex
Wording of para. (e) in force until 1 January 2016 (e) subject to the provisions of paragraph (a) (iii), no
amount transferred to or from the corporate fund in terms of the provisions of subsection (7), shall be deducted from or included in the income of the policyholder fund from or to which such amount was transferred, as the case may be;
(f) (g)
the amount of any transfer contemplated in subsection (6) or (8) shall not be deducted from the income of the fund from which it is transferred and shall not be included in the income of the fund to which it is transferred;
(i) premiums and claims in respect of a policy entered into between that insurer and a person other than a resident other than premiums and claims in respect of a risk policy;
(ii) premiums and reinsurance claims received and claims and reinsurance premiums paid in respect of policies, other than policies contemplated in subparagraph (i) or risk policies;
shall be disregarded: Provided that where an amount in respect of a claim is received by or accrues to an insurer in respect of a policy (other than a policy that would have constituted a risk policy had that policy been concluded on 1 January 2016) entered into between that insurer and a person other than a resident, there must be included in the gross income of the policyholder fund associated with that policy an amount equal to that claim less the aggregate amount of premiums incurred or paid in terms of that policy which relates to that claim;
[Para. (g) substituted by s. 47 (1) (r)* and amended by s.
47 (1) (s) of Act 43 of 2014† – date of commencement of both paras. (r) and (s) was to have been 1 January 2016‡. Para. (g) has, however, also been substituted by s. 53 (1) (e) of Taxation Laws Amendment Act, 2015 (date of commencement also: 1 January 2016); the paragraph, as substituted by the said s. 53 (1) (e), applies iro years of assessment commencing on or after that date.]
(h) no amount may be deducted by way of an allowance in respect of an asset as de ned in the Eighth Schedule other than a nancial instrument.
[Para. (h) added by s. 62 (1) (h) of Act 22 of 2012 (date of commencement: 1 January 2013; this paragraph applies in respect of years of assessment commencing on or after that date) and substituted by s. 77 (1) (g) of Act 31 of 2013 – substitution deemed to have come into operation on 1 January 2013 and applies in respect of years of assessment commencing on or after that date.]
(11A) . . .
[Sub-s. (11A) inserted by s. 15 (1) (g) of Act 5 of 2001, substituted by s. 15 (1) of Act 19 of 2001 and deleted by
(13) . . .
[Sub-s. (13) deleted by s. 52 of Act 7 of 2010.]
(13A) (a) Notwithstanding section 23 (e), in the determination of the taxable income derived by an insurer in respect of its risk policy fund in respect of any year of assessment, there shall be allowed as a deduction from the income of the risk policy fund an amount equal to the
Prelex
Wording of sub-s. (12) in force until 1 January 2016
(12) In the allocation of any asset, expenditure or liability to any fund contemplated in subsection (4), an insurer shall, when establishing such fund and at all times thereafter—
(a) to the extent to which such asset, expenditure or liability relates exclusively to business conducted by it in any one fund, allocate such asset, expenditure or liability to that fund; and
(b) to the extent to which such asset, expenditure or liability does not relate exclusively to business conducted by it in any one fund, allocate such asset, expenditure or liability in a manner which is consistent with and appropriate to the manner in which its business is conducted.
Prelex
Wording of para. (g) in force until 1 January 2016 (g) premiums and reinsurance claims received and
claims and reinsurance premiums paid shall be disregarded; and
* The words ‘in respect of policies, other than risk policies,’ were to have been inserted after ‘premiums paid’.
† A proviso was to have been added to para. (g).
‡ Para. (s) of s. 47 (1) originally came into operation on 1 December 2014. This date was, however, retrospectively
amended (to read ‘1 January 2016’) by s. 152 (1) of Taxation Laws Amendment Act, 2015. There is still a discrepancy in that s. 47 (5) of Act 43 of 2014 has not been deleted or amended and it still reads:
‘(5) Paragraph (s) of subsection (1) comes into operation on 1 December 2014 and applies in respect of reinsurance claims received or accrued on or after that date.’
It is submitted that the intention of the Legislature was probably that the wording of para. (g) proposed in the said s. 53 (1) (e) of the Taxation Laws Amendment Act 2015, should be the version to come into operation wef 1 January 2016.
220 SAIT CompendIum oF TAx LegISLATIon VoLume 1