South Africa Case Law

Coronation Investment Management SA (Pty) Limited v Commissioner for the South African Revenue Service (CCT 47/23)

Coronation Investment Management SA (Pty) Limited v Commissioner for the South African Revenue Service (CCT 47/23) [2024] ZACC 11; 2024 (9) BCLR 1128 (CC); 2024 (6) SA 310 (CC); 87 SATC 150 (21 June 2024)

Court

Constitutional Court

Case number

CCT 47/23

Judges

Zondo, Bilchitz, Chaskalson, Madlanga, Majiedt, Mathopo, Mhlantla, Theron, Tshiqi

The Constitutional Court held that CGFM's actual business was fund management, not investment management trading, and that its operations in Ireland met the requirements for a foreign business establishment under section 9D of the Income Tax Act. The Court found that CGFM's delegation of investment management trading to licensed third parties was lawful, standard industry practice, and did not undermine its economic substance or FBE status. The Supreme Court of Appeal erred by adopting a theoretical approach to CGFM's business and conflating fund management with investment management trading.…

Source excerpt

• Controlled Foreign Company
• Foreign Business Establishment
• Income Tax Exemption
• Economic Substance
• Outsourcing Of Primary Operations
• Anti Avoidance

Commissioner for the South African Revenue Service v Coronation Investment Management SA (Pty) Ltd (1269/2021)

Commissioner for the South African Revenue Service v Coronation Investment Management SA (Pty) Ltd (1269/2021) [2023] ZASCA 10; [2023] 2 All SA 44 (SCA); 2023 (3) SA 404 (SCA); 85 SATC 413 (7 February 2023)

Court

Supreme Court of Appeal

Case number

1269/2021

Judges

Makgoka JA, Nicholls JA, Nhlangulela AJJA, Salie AJJA, Mali AJJA

The Supreme Court of Appeal held that CGFM’s outsourced investment management remained its primary business, so it was not a foreign business establishment under section 9D.

• Controlled Foreign Company
• Foreign Business Establishment Exemption
• Income Tax Act Section 9d
• Tax Administration Act Understatement Penalty
• Outsourcing In Fund Management
• Controlled-foreign-company

Sasol Oil (Pty) Ltd v Commissioner for the South African Revenue Service (17583/2012)

Sasol Oil (Pty) Ltd v Commissioner for the South African Revenue Service (17583/2012) [2012] ZAGPPHC 312 (30 November 2012)

Court

North Gauteng High Court, Pretoria

Case number

17583/2012

Judge

A.M.L. Phatudi

The High Court set aside SARS’s second ground of assessment, holding it was a new basis raised outside the permitted period and contrary to legality.

• Income Tax Act
• Controlled Foreign Company
• Assessment Prescription
• General Deduction Formula
• Administrative Action
• Principle Of Legality