South Africa Case Law

Natal Laeveld Boerdery BK v Kommissaris van Binnelandse Inkomste (55/96)

Natal Laeveld Boerdery BK v Kommissaris van Binnelandse Inkomste (55/96) [1997] ZASCA 80; 1998 (1) SA 639 (SCA); [1998] 1 All SA 5 (A); (26 September 1997)

Court

Supreme Court of Appeal

Case number

55/96

Judges

Van Heerden, Eksteen, Howie, Scott, Plewman

The court held that interest on a loan used to buy out a member of a close corporation was not deductible, because the dominant purpose was not income production.

• Deductibility Of Interest
• Purpose Of Expenditure
• Income Tax Act Section 11a
• Income Tax Act Section 23g
• Tax-law
• Interest-deduction

Commissioner for Inland Revenue v Pick 'n Pay Wholesalers (Pty) Ltd (44/87)

Commissioner for Inland Revenue v Pick 'n Pay Wholesalers (Pty) Ltd (44/87) [1987] ZASCA 44; [1987] 4 All SA 432 (AD) (14 May 1987)

Court

Supreme Court of Appeal

Case number

44/87

Judges

Corbett, Botha, Hefer, Nestadt, Nicholas

The court found that Pick 'n Pay did not discharge the onus of proving that the donation to the Urban Foundation was made solely for the purposes of trade. The evidence indicated that the donation was motivated by both a desire to obtain publicity and a genuine philanthropic purpose. The directors' own statements and the circumstances surrounding the donation, including its presentation at a press conference and the involvement of Mr Ackerman in both the donor and donee organisations, supported the conclusion that the expenditure was not exclusively for business purposes. As a result, section…

Source excerpt

• Deductibility Of Expenditure
• Dual Purpose Expenditure
• Income Tax Act Section 11
• Income Tax Act Section 23g