Page 283 - SAIT Compendium 2016 Volume1

s 61
INCOME TAX ACT 58 OF 1962 s 62
of any trust, as the case may be, shall be deemed to include a reference to any property disposed of under a donation which is under the management, disposition or control of the agent or to property disposed of under a donation which is the subject of the trust, as the case may be.
[Para. (d) substituted by s. 13 (1) of Act 21 of 2012 – date of commencement: 1 January 2013; the substituted paragraph applies in respect of years of assessment commencing on or after that date.]
(e) . . .
[Para. (e) deleted by s. 271 of Act 28 of 2011 – date of
period than the life of such person, over such
lesser period;
[Sub-para. (i) amended by s. 8 (c) of Act 114 of 1977.] (ii) in the case of an annuity charged upon the property, by capitalizing at twelve per cent the amount of the annuity over the expectation of life of the person entitled to such annuity, or, if it is to be held for a lesser period than the life of
such person, over such lesser period; or
[Sub-para. (ii) amended by s. 8 (c) of Act 114 of 1977.] (iii) in the case of any other interest, by capitalizing at twelve per cent such amount as the Commissioner may consider reasonable as representing the annual yield of such interest, over the expectation of life of the person entitled to such interest, or, if such interest is to be held for a lesser period than the life of such person,
over such lesser period;
[Sub-para. (iii) amended by s. 8 (c) of Act 114 of 1977.] (d) in the case of any other property, the fair market value of such property as at the date upon which the donation takes effect: Provided that in any case in which, as a result of conditions which in the opinion of the Commissioner were imposed by or at the instance of the donor, the value of any property is reduced in consequence of the donation, the value of such property shall be determined as though the conditions in terms of which the value of the said property is reduced in consequence of the donation,
had not been imposed.
(1A) Where any company not quoted on any stock
exchange owns immovable property on which bona de farming operations are being carried on in the Republic, the value of such immovable property shall, in so far as it is relevant for the purposes of determining the value of any shares in such company, be determined in the manner prescribed in the de nition of ‘fair market value’ in section 55 (1).
[Sub-s. (1A) inserted by s. 36 of Act 101 of 1990.]
(2) For the purposes of paragraphs (a) and (c) of subsection (1) the annual value of the right of enjoyment of a property means an amount equal to twelve per cent upon the value of the full ownership of the property which is subject to any duciary, usufructuary or other like interest: Provided that—
(a) where the Commissioner is satis ed that the property which is subject to any such interest could not reasonably be expected to produce an annual yield equal to 12 per cent on such value of the property, the Commissioner may x such sum as representing the annual yield as may seem to him to be reasonable, and the sum so xed shall for the purposes of paragraphs (a) and (c) of subsection (1) be deemed to be the annual value of the enjoyment of such property;
[Para. (a) amended by s. 8 (d) of Act 114 of 1977, by s. 23 (1) of Act 28 of 1997 and by s. 33 (b) of Act 53 of 1999.]
(b) where the property which is subject to any such interest consists of books, pictures, statuary or other objects of art, the annual value of the right of enjoyment shall for the purposes of paragraph (a) of subsection (1) be deemed to be the average net receipts (if any) derived by the person entitled to such right of enjoyment of such property during the three years immediately preceding the date on which the donation took effect.
[Sub-s. (2) amended by s. 8 (d) of Act 114 of 1977.]
(3) Where for the purposes of subsection (1) any calculation is required to be made over the expectation of life of any
(f)
. . .
commencement: 1 October 2012.]
[Para. (f) added by s. 25 of Act 90 of 1962 and deleted by s. 271 of Act 28 of 2011 – date of commencement: 1 October 2012.]
(g) . . .
[Para. (g) added by s. 25 of Act 90 of 1962, substituted
by s. 29 of Act 90 of 1988 and deleted by s. 3 of Tax Administration Laws Amendment Act, 2015 – date of commencement: date of promulgation of Tax Administration Laws Amendment Act, 2015.]
(h) . . .
[Para. (h) added by s. 57 of Act 45 of 2003 and deleted
by s. 271 of Act 28 of 2011 – date of commencement: 1 October 2012.]
62 Value of property disposed of under donations
(1) For the purposes of donations tax the value of any property shall be deemed to be—
(a) in the case of any duciary, usufructuary or other
like interest in property, an amount determined by capitalizing at twelve per cent the annual value of the right of enjoyment of the property over which such interest was or is held, to the extent to which the donee becomes entitled to such right of enjoyment, over the expectation of life of the donor, or if such right of enjoyment is to be held for a lesser period than the life of the donor, over such lesser period; [Para. (a) amended by s. 8 (a) of Act 114 of 1977.]
(b) in the case of any right to any annuity, an amount equal to the value of the annuity capitalized at twelve per cent over the expectation of life of the donor, or if such right is to be held by the donee for a lesser period than the life of the donor, over such lesser period;
[Para. (b) amended by s. 8 (b) of Act 114 of 1977.]
(c) in the case of a right of ownership in any movable or immovable property which is subject to a usufructuary or other like interest in favour of any person, the amount by which the fair market value of the full ownership of such property exceeds the value
of such interest, determined—
(i) in the case of a usufructuary interest, by
capitalizing at twelve per cent the annual value of the right of enjoyment of the property subject to such usufructuary interest over the expectation of life of the person entitled to such interest, or, if such right of enjoyment is to be held for a lesser
Prelex
Wording of para. (g) in force until its deletion wef date of promulgation of Taxation Laws Amendment Act, 2015
(g) the reference in section 96 (2) to the taxable income
of any deceased person shall be deemed to include a reference to the value of property disposed of by such person under any donation.
SAIT CompendIum oF TAx LegISLATIon VoLume 1 275
INCOME TAX ACT – SECTIONS