South Africa Case Law

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

Gerber v Commissioner for Inland Revenue (24/88)

Gerber v Commissioner for Inland Revenue (24/88) [1989] ZASCA 91; [1989] 4 All SA 950 (AD) (29 August 1989)

Court

Supreme Court of Appeal

Case number

24/88

Judges

Corbett, Hoexter, Nestadt, Vivier, Nicholas

The court held that dividend-stripping share dealings were trading, but section 19 applied to scale down both dividend income and related deductions.

• Income Tax Act
• Deductibility Of Expenditure
• Dividend Stripping
• Trading Stock
• Section 19
• Section 8d