Liberty Investors Ltd v Commissioner for the South African Revenue Service (353/2004)
Liberty Investors Ltd v Commissioner for the South African Revenue Service (353/2004) [2005] ZASCA 69; 2006 (2) SA 1 (SCA); 67 SATC 313 (30 August 2005)
The court held that the amount received as dividends from the subsidiary was of a revenue nature and that its subsequent transfer to share capital and share premium account did not alter its character. The relevant statutory provisions, specifically the proviso (i) to the definition of 'dividend' in s 1 of the Income Tax Act, require that unless the amount can be shown to consist of profits of a capital nature, it must be deemed to be profits of a revenue nature available for distribution. The appellant failed to demonstrate that the amount in question comprised profits of a capital nature, a…
Source excerpt
- Secondary Tax On Companies
- Dividend Definition
- Capitalisation Shares
- Liquidation Distribution