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Eighth Schedule INCOME TAX ACT 58 OF 1962 Eighth Schedule
(4) The value contemplated in subparagraph (1) (f) (i) may only be used on the death of a person or when the immovable property is disposed of by way of donation or non-arm’s length transaction, if—
(a) that value was used for the purposes of paragraph 26 or 27; or
(b) the person acquired the immovable property by way of donation or inheritance or non-arm’s length transaction at
that value.
32 Base cost of identical assets
(1) This paragraph applies to assets which form part of a holding of identical assets.
[Sub-para. (1) substituted by s. 84 (1) (a) of Act 60 of 2001.]
(2) For the purposes of this paragraph ‘identical assets’ means a group of similar assets which—
(a) if any one of them were disposed of, would realise the same amount regardless of which of them was so disposed of; and
(b) are not able to be individually distinguished apart from any identifying numbers which they may bear.
(3) Subject to subparagraphs (3A) and (3B), the base cost of identical assets must be determined by using one of the
following methods—
[Words in sub-para. (3) preceding item (a) substituted by s. 113 (1) (a) of Act 22 of 2012 – date of commencement deemed to have been 29 February 2012; this substitution applies iro disposals made on or after that date.]
(a) speci c identi cation; or (b) the rst in rst out method.
[Sub-para. (3) amended by s. 28 (1) of Act 19 of 2001 and substituted by s. 84 (1) (b) of Act 60 of 2001.]
(3A) The weighted average method of determining base cost of assets, as contemplated in subparagraph (4), may be
used for identical assets that do not constitute assets contemplated in subparagraph (3B) and which—
[Words in sub-para. (3A) preceding item (a) substituted by s. 113 (1) (b) of Act 22 of 2012 – date of commencement deemed to have been 29 February 2012; this substitution applies iro disposals made on or after that date.]
(a) from the date of acquisition to the date of disposal constituted assets contemplated in paragraph 31 (1) (a), other than instruments contemplated in item (d);
[Item (a) substituted by s. 79 (1) (a) of Act 74 of 2002.]
(b) constitute participatory interests—
(i) contemplated in paragraph 31 (1) (c), where the prices of these participatory interests or shares are regularly published in a national or international newspaper;
(ii) in any portfolio comprised in any collective investment scheme managed or carried on by a company registered as a manager under section 42 of the Collective Investment Schemes Control Act for purposes of Parts IV and V of that Act; or
[Subitem (ii) substituted by s. 132 of Act 31 of 2013 – date of commencement: 12 December 2013.]
(iii) in any arrangement or scheme contemplated in paragraph (e) (ii) of the de nition of ‘company’ in section 1 of the Act, which is approved in terms of section 65 of the Collective Investment Schemes Control Act by the
Registrar as de ned in section 1 of the latter Act;
[Subitem (iii) substituted by s. 132 of Act 31 of 2013 – date of commencement: 12 December 2013.] [Item (b) substituted by s. 39 (1) of Act 30 of 2002 and by s. 79 (1) (b) of Act 74 of 2002.]
(c) constitute coins made mainly from gold or platinum, where the prices of these coins are regularly published in a
national or international newspaper; or
(d) from the date of acquisition to the date of disposal constituted instruments as de ned in section 24J that were listed
on a recognised exchange and for which a price was quoted on that exchange,
[Item (d) inserted by s. 79 (1) (d) of Act 74 of 2002.]
and where a person uses the weighted average method for any identical asset contemplated in item (a), (b), (c) or (d), that
method must be used for all identical assets, contemplated in that item, held by that person.
[Sub-para. (3A) inserted by s. 84 (1) (c) of Act 60 of 2001 and amended by s. 79 (1) (e) of Act 74 of 2002.]
(3B) The weighted average method of determining base cost of assets, as contemplated in subparagraph (4), must be used for identical assets that are, in terms of section 29A, allocated to all the policyholder funds of an insurer as de ned
in that section: Provided that this subparagraph must not apply to any asset—
(a) that constitutes—
(i) an instrument as de ned in section 24J (1);
(ii) an interest rate agreement as de ned in section 24K (1);
(iii) a contractual right or obligation the value of which is determined directly or indirectly with reference to— (aa) an instrument contemplated in subparagraph (i);
(bb) an interest rate agreement contemplated in subparagraph (ii); or
(cc) any speci ed rate of interest;
(iv) trading stock; or
(v) a policy of reinsurance; or
(b) held by an insurer if that insurer is a Category III Financial Services Provider as de ned in section 29B (1) and that asset is held by that insurer in its capacity as a Category III Financial Services Provider.
[Sub-para. (3B) inserted by s. 113 (1) (c) of Act 22 of 2012 – date of commencement deemed to have been 29 February 2012; this inserted subparagraph applies iro disposals made on or after that date.]
(4) In applying the weighted average method of determining base cost—
(a) the weighted average base cost, on valuation date, of identical assets acquired and not disposed of before valuation
date is equal to the valuation date value of those identical assets, as contemplated in paragraph 28, or the market value of those identical assets, as contemplated in paragraph 29, divided by the number of those identical assets; and
SAIT CompendIum oF TAx LegISLATIon VoLume 1 385
INCOME TAX ACT – SCHEDULES