Page 401 - SAIT Compendium 2016 Volume1

Eighth Schedule INCOME TAX ACT 58 OF 1962 Eighth Schedule
(a) so much of a capital gain or capital loss determined in respect of the disposal of the primary residence of that person or that special trust as does not exceed R2 million; or
[Item (a) substituted by s. 10 (1) of Act 13 of 2012 – date of commencement deemed to have been 1 March 2012; the substituted item applies iro years of assessment commencing on or after that date.]
(b) a capital gain determined in respect of the disposal of the primary residence of that person or that special trust if the proceeds from the disposal of that primary residence do not exceed R2 million.
[Item (b) substituted by s. 103 (1) of Act 7 of 2010.]
[Sub-para. (1) substituted by s. 93 (1) of Act 60 of 2001, amended by s. 33 of Act 9 of 2006, by s. 2 (2) (b) of Act 8 of
2007 and by s. 1 (2) (c) of Act 3 of 2008 and substituted by s. 73 (1) (a) of Act 17 of 2009.]
(2) Where more than one natural person or special trust jointly holds an interest in a primary residence at the same time,
the amount to be disregarded in terms of subparagraph (1) must be apportioned in relation to each interest so held.
[Sub-para. (2) substituted by s. 29 (1) of Act 19 of 2001.]
(3) Subject to paragraph 48, only one residence may be a primary residence of a person or a special trust for any period during which that person or special trust held an interest in more than one residence.
(4) Subparagraph (1) (b) does not apply where a natural person or a special trust disposes of an interest in a residence which is or was a primary residence, and that person or a bene ciary of that special trust or a spouse of that person or bene ciary—
(a) was not ordinarily resident in that residence throughout the period commencing on or after the valuation date during
which that person or special trust held that interest; or
(b) used that residence or a part thereof for the purposes of carrying on a trade for any portion of the period commencing
on or after the valuation date during which that person or special trust held that interest.
[Sub-para. (4) added by s. 73 (1) (b) of Act 17 of 2009.]
46 Size of residential property qualifying for exclusion
Where a primary residence and the land on which it is situated is disposed of by a person, the provisions of paragraph 45 apply in respect of so much of that land, including unconsolidated adjacent land, as—
(a) does not exceed two hectares;
(b) is used mainly for domestic or private purposes together with that residence; and
[Sub-para. (b) substituted by s. 30 (1) of Act 19 of 2001.] (c) is disposed of at the same time and to the same person as that residence.
47 Apportionment in respect of periods where not ordinarily resident
Subject to paragraph 48, where—
(a) a natural person or special trust disposes of an interest in a residence which is or was a primary residence; and
(b) that person or a bene ciary of that special trust or a spouse of that person or bene ciary, was not ordinarily resident
in that residence throughout the period on or after the valuation date during which that person or special trust held
that interest,
[Sub-para. (b) amended by s. 94 (1) of Act 60 of 2001.]
then the portion of the capital gain or capital loss to be disregarded in terms of paragraph 45 must be determined with
reference to the portion of that period during which that person, bene ciary or spouse was so ordinarily resident.
48 Disposal and acquisition of primary residence
A natural person or a bene ciary of a special trust must for purposes of paragraph 47 be treated as having been ordinarily resident in a residence for a continuous period (not exceeding two years), if that person did not reside in that residence during that period for any of the following reasons—
(a) at the time the residence was that person’s primary residence it had been offered for sale and vacated due to the
acquisition or intended acquisition of a new primary residence;
(b) that residence was being erected on land acquired for that purpose in order to be used as that person’s primary
residence;
(c) the residence had been accidentally rendered uninhabitable; or
(d) the death of that person.
49 Non-residential use
Subject to paragraph 50—
(a) where a natural person or special trust—
(i) disposes of an interest in a primary residence; or
(ii) disposes of an interest in a residence that was a primary residence for a part of the period on or after the
valuation date during which that person or special trust held that interest; and
[Subitem (ii) substituted by s. 95 (1) (a) of Act 60 of 2001.]
(b) where that person or a bene ciary of that special trust used the residence referred to in subparagraph (a) or a part
thereof for the purposes of carrying on a trade for any portion of the period on or after the valuation date during which that person or special trust held that interest,
[Item (b) substituted by s. 95 (1) (b) of Act 60 of 2001.]
the portion of the capital gain or capital loss to be disregarded in terms of paragraph 45 must be determined with reference to the period on or after the valuation date during which that person or bene ciary used that residence for domestic purposes as well as to the part of that residence used by that person or bene ciary mainly for purposes other
than the carrying on of a trade.
SAIT CompendIum oF TAx LegISLATIon VoLume 1 393
INCOME TAX ACT – SCHEDULES