South Africa Case Law

Anglovaal Mining Ltd v Commissioner for the South African Revenue Services (411/08)

Anglovaal Mining Ltd v Commissioner for the South African Revenue Services (411/08) [2009] ZASCA 109; 2010 (2) SA 299 (SCA); [2010] 1 All SA 187 (SCA); 71 SATC 293 (22 September 2009)

Court

Supreme Court of Appeal

Case number

411/08

Judges

Streicher, Mthiyane, Hurt, Leach, Bosielo

The Supreme Court of Appeal held that Anglovaal’s NBL shares were trading stock, not capital, and allowed deduction of the 1999 loss under the Income Tax Act.

• Income Tax Act
• Trading Stock Vs Capital Asset
• Deductibility Of Losses
• Assessment Years
• Onus Of Proof
• Income-tax

Sentra-Oes Kooperatief Bpk v Kommissaris van Binnelandse Inkomste (312/93)

Sentra-Oes Kooperatief Bpk v Kommissaris van Binnelandse Inkomste (312/93) [1995] ZASCA 9; 1995 (3) SA 197 (AD); (9 March 1995)

Court

Supreme Court of Appeal

Case number

312/93

Judges

Corbett, Hoexter, Smalberger, Kumleben, Nicholas

The court held that a short-term insurer’s irrecoverable R5 million deposit loss was capital in nature and not deductible; condonation was refused and the appeal struck off.

• Income Tax Act 58 Of 1962
• Deductibility Of Losses
• Capital Vs Revenue Loss
• Short Term Insurance
• Investment Losses
• Tax-law

Commissioner for Inland Revenue v Felix Schuh (SA) (Pty) Ltd (392/92)

Commissioner for Inland Revenue v Felix Schuh (SA) (Pty) Ltd (392/92) [1994] ZASCA 40; 1994 (2) SA 801 (AD); [1994] 2 All SA 329 (A) (28 March 1994)

Court

Supreme Court of Appeal

Case number

392/92

Judges

Corbett, Smalberger, Nienaber, Howie, Olivier

The Supreme Court of Appeal held that unrealised foreign exchange losses on loans repayable in foreign currency do not constitute losses 'actually incurred' under section 11(a) of the Income Tax Act in the year they arise, unless the liability is discharged by repayment. The mere increase in the rand equivalent of the foreign currency loan at year-end, due to exchange rate fluctuations, is not a deductible loss for tax purposes. Only when the loan is repaid and the taxpayer is required to expend more rands than originally received does a deductible loss arise. The Court distinguished the pres…

Source excerpt

• Income Tax Act
• Foreign Exchange Losses
• Deductibility Of Losses
• Unrealised Losses
• Taxable Income Computation

Commissioner for Inland Revenue v SA Mutual Unit Trust Management Company Ltd. (532/88)

Commissioner for Inland Revenue v SA Mutual Unit Trust Management Company Ltd. (532/88) [1990] ZASCA 76; 1990 (4) SA 529 (AD); (23 August 1990)

Court

Supreme Court of Appeal

Case number

532/88

Judges

Corbett, Van Heerden, Kumleben, Nicholas, Goldstone

The Supreme Court of Appeal held that the respondent failed to discharge the onus of proving that, at the time of the original assessment for the 1981 tax year, there was a practice generally prevailing in the Department of Inland Revenue to allow the deduction of the full cost of shares acquired in dividend stripping operations. The evidence showed some uncertainty and isolated instances of such losses being allowed, but did not establish a consistent and authorized departmental practice. The Court found that the Commissioner was not precluded by section 79(1), proviso (iii) from issuing rev…

Source excerpt

• Income Tax Assessment
• Dividend Stripping
• Practice Generally Prevailing
• Onus Of Proof
• Deductibility Of Losses