Page 398 - SAIT Compendium 2016 Volume1

Eighth Schedule INCOME TAX ACT 58 OF 1962 Eighth Schedule
(2) For the purposes of subparagraph (1), there must not be taken into account in determining the period of 91 days any days in which the person disposing of the nancial instrument—
(a) has an option to sell, is under a contractual obligation to sell or has made (and not closed) a short sale of a nancial
instrument of the same kind and of the same or equivalent quality;
(b) is the grantor of an option to buy a nancial instrument of the same kind and of the same or equivalent quality; or
(c) has otherwise diminished risk of loss in respect of that nancial instrument by holding one or more contrary
positions with respect to a nancial instrument of the same kind and of the same or equivalent quality.
[Item (c) substituted by s. 99 of Act 7 of 2010.]
(3) For the purposes of this paragraph, a connected person in relation to—
(a) a natural person does not include a relative of that person other than a parent, child, stepchild, brother, sister, grandchild or grandparent of that person; or
(b) a fund of an insurer contemplated in section 29A does not include another such fund of that insurer in respect of the disposal of an asset by such fund to another such fund.
[Item (b) substituted by s. 74 (1) of Act 31 of 2005.] [Sub-para. (3) substituted by s. 90 (1) (b) of Act 60 of 2001.]
(4) This paragraph must not apply to any asset—
(a) in respect of which the weighted average method of determining base cost of assets, as contemplated in paragraph
32 (4), is used; and
(b) if that asset is, in terms of section 29A, allocated to any policyholder fund of an insurer as de ned in that section.
[Sub-para. (4) added by s. 116 (1) (b) of Act 22 of 2012 – date of commencement deemed to have been 29 February 2012; this subparagraph applies iro disposals made on or after that date.]
42A . . .
[Para. 42A inserted by s. 75 (1) of Act 35 of 2007 and repealed by s. 135 of Act 31 of 2013 – date of commencement: 12 December 2013.]
43 Assets disposed of or acquired in foreign currency
(1) Where, during any year of assessment, a person that is a natural person or a trust that is not carrying on a trade disposes of an asset for proceeds in a foreign currency after having incurred expenditure in respect of that asset in the same currency, that person must determine the capital gain or capital loss on the disposal in that currency and that capital gain or capital loss must be translated to the local currency by applying the average exchange rate for the year of assessment in which that asset was disposed of or by applying the spot rate on the date of disposal of that asset.
[Sub-para. (1) substituted by s. 101 (1) (a) of Act 45 of 2003, by s. 75 (1) (a) of Act 31 of 2005, by s. 76 (a) of Act 35 of 2007, by s. 117 (1) (a) of Act 22 of 2012 (date of commencement: 1 March 2013 (the original commencement date of the said s. 117 (1) (a) (‘1 January 2013’) was retrospectively replaced by s. 208 (1) of Act 31 of 2013); this substitution applies iro disposals made on or after that date) and by s. 136 (1) (a) of Act 31 of 2013 – date of commencement: 1 March 2014; the substitution applies iro disposals made on or after that date.]
(1A) Where, during any year of assessment, a person disposes of an asset (other than a disposal contemplated in subparagraph (1)) for proceeds in a foreign currency or after having incurred expenditure in respect of that asset in a foreign currency, that person must, for the purposes of determining the capital gain or capital loss on the disposal of that asset, translate—
(a) the proceeds into the local currency at the average exchange rate for the year of assessment in which that asset was disposed of or at the spot rate on the date of disposal of that asset; and
(b) the expenditure incurred in respect of that asset into the local currency at the average exchange rate for the year of assessment during which that expenditure was incurred or at the spot rate on the date on which that expenditure was incurred.
[Sub-para. (1A) inserted by s. 117 (1) (b) of Act 22 of 2012 (date of commencement: 1 March 2013 (the original
commencement date of the said s. 117 (1) (b) (‘1 January 2013’) was retrospectively replaced by s. 208 (1) of Act 31 of 2013); this subparagraph applies iro disposals made on or after that date) and by s. 136 (1) (b) of Act 31 of 2013 – date of commencement: 12 December 2013; the substitution applies iro disposals made on or after that date.]
(2) . . .
[Sub-para. (2) substituted by s. 101 (1) (b) of Act 45 of 2003 and amended by s. 75 (1) (b) and (c) of Act 31 of 2005, by s. 51 of Act 20 of 2006, by s. 76 (b) and (c) of Act 35 of 2007 and by s. 100 (1) (a) of Act 7 of 2010 and deleted by s. 136 (1) (c) of Act 31 of 2013 – date of commencement: 12 December 2013; the deletion applies iro disposals made on or after that date.]
(3) . . .
(4) . . .
[Sub-para. (3) omitted by s. 84 (1) of Act 74 of 2002.]
[Sub-para. (4) amended by s. 101 (1) (c), (d) and (e) of Act 45 of 2003, by s. 75 (1) (d) of Act 31 of 2005, by s. 76 (d) of Act 35 of 2007 and by s. 111 (1) (a) and (b) of Act 24 of 2011 and deleted by s. 117 (1) (c) of Act 22 of 2012 – date of commencement: 1 March 2013 (the original commencement date of the said s. 117 (1) (c) (‘1 January 2013’) was retrospectively replaced by s. 208 (1) of Act 31 of 2013); this deletion applies iro disposals made on or after that date.]
(5) Where a person is treated as having derived an amount of proceeds from the disposal of any asset and the expenditure incurred to acquire that asset is determined in any foreign currency—
(a) (b)
the amount of those proceeds must be treated as being denominated in the currency of the expenditure incurred to acquire that asset; and
the expenditure incurred by the person acquiring that asset must for purposes of paragraphs 12, 38 and 40 be treated as being denominated in that currency.
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SAIT CompendIum oF TAx LegISLATIon VoLume 1