Page 414 - SAIT Compendium 2016 Volume1

Eighth Schedule INCOME TAX ACT 58 OF 1962 Eighth Schedule
that capital gain or that portion thereof must be taken into account in determining the aggregate capital gain or aggregate capital loss of the person who made that donation, settlement or other disposition and disregarded when determining the aggregate capital gain or aggregate capital loss of any other person.
71 Attribution of capital gain subject to revocable vesting
Where—
(a) a deed of donation, settlement or other disposition confers a right upon a bene ciary thereof who is a resident to
receive a capital gain attributable to that donation, settlement or other disposition or any portion of that gain;
(b) that right may be revoked or conferred upon another by the person who conferred it; and
(c) a capital gain attributable to that donation, settlement or other disposition or a portion of that gain has in terms of
that right vested in that bene ciary during a year of assessment throughout which the person who conferred that
right has been a resident and has retained the power to revoke that right,
that capital gain or that portion thereof must be disregarded when determining the aggregate capital gain or aggregate capital loss of that bene ciary and be taken into account when determining the aggregate capital gain or aggregate capital loss of the person retaining the power of revocation.
72 Attribution of capital gain vesting in non-resident
Where—
(a) a resident has made a donation, settlement or other disposition to any person (other than an entity, which is not
resident and which is similar to a public bene t organisation contemplated in section 30); and
[Sub-para. (a) substituted by s. 112 of Act 45 of 2003.]
(b) a capital gain (including any amount that would have constituted a capital gain had that person been a resident)
attributable to that donation, settlement or other disposition has arisen during a year of assessment and has during that year vested in or is treated as having vested in any person who is not a resident (other than a controlled foreign company, in relation to that resident),
[Sub-para. (b) substituted by s. 94 of Act 74 of 2002 and by s. 80 (1) of Act 31 of 2005.]
that capital gain must be disregarded when determining the aggregate capital gain or aggregate capital loss of the person in whom it vests and taken into account when determining the aggregate capital gain or aggregate capital loss of that resident.
73 Attribution of income and capital gain
(1) Where both an amount of income and a capital gain are derived by reason of or are attributable to a donation, settlement or other disposition, the total amount of that income and gain—
(a) that is deemed in terms of section 7 to be that of a person other than the one to whom it accrues or by whom it is
received or for whose bene t it is expended or accumulated; and
(b) that is attributed in terms of this Part to a person other than the one in whom it vests,
shall not exceed the amount of the bene t derived from that donation, settlement or other disposition.
(2) For purposes of this paragraph, the bene t derived from a donation, settlement or other disposition means the amount by which the person to whom that donation, settlement or other disposition was made, has bene ted from the fact that it was made for no or an inadequate consideration, including consideration in the form of interest.
PART XI
COMPANY DISTRIBUTIONS (paras. 74–79)
74 De nitions
‘capital distribution’ . . .
[De nition of ‘capital distribution’ amended by s. 83 of Act 35 of 2007, substituted by s. 78 (1) (a) of Act 17 of 2009 and
deleted by s. 117 (1) (a) of Act 24 of 2011 – date of commencement: 1 April 2012.]
‘company’ . . .
[De nition of ‘company’ substituted by s. 95 (1) of Act 74 of 2002 and deleted by s. 113 (1) (a) of Act 45 of 2003.]
‘date of distribution’, in relation to any distribution, means—
(a) to the extent that the distribution does not consist of a distribution of an asset in specie—
(i) where the company that makes the distribution is a listed company, the date on which the distribution is paid; or
(ii) where the company that makes the distribution is not a listed company, the earlier of the date on which the distribution is paid or becomes due and payable; or
(b) to the extent that the distribution consists of a distribution of an asset in specie, the earlier of the date on which the distribution is paid or becomes due and payable.
[De nition of ‘date of distribution’ inserted by s. 113 (1) (b) of Act 45 of 2003, amended by s. 110 (1) (a) of Act 7 of 2010 and by s. 117 (1) (b) of Act 24 of 2011 (date of commencement: 1 April 2012) and substituted by s. 130 (1) of Act 22 of 2012 – date of commencement deemed to have been 1 April 2012; the substituted de nition applies iro distributions made on or after that date.]
‘distribution’ . . .
[De nition of ‘distribution’ substituted by s. 59 (1) of Act 3 of 2008 and by s. 78 (1) (b) of Act 17 of 2009 and deleted by
s. 117 (1) (c) of Act 24 of 2011 – date of commencement: 1 April 2012.]
[De nition of ‘share’ substituted by s. 106 (1) of Act 60 of 2001 and by s. 113 (1) (c) of Act 45 of 2003, amended by s. 110
‘share’ . . .
(1) (b) and (c) of Act 7 of 2010 and deleted by s. 117 (1) (d) of Act 24 of 2011 – date of commencement: 1 April 2012.]
406 SAIT CompendIum oF TAx LegISLATIon VoLume 1