CAPITAL GAINS TAX – WHEN DOES IT COME INTO PLAY?
The distinction between amounts received of a capital nature as opposed to a revenue (or income) nature is essential for income tax purposes. Non-capital amounts received, such as from the disposal of trading stock, are subject to tax at a higher effective rate compared to capital profits. The primary intention with which an asset is […]
RING-FENCING OF ASSESSED LOSSES OF CERTAIN TRADES – PART I
Persons are generally allowed to set off any losses incurred in respect of one trade against the income derived from another trade, thereby reducing their overall tax liability. However, section 20A of the Income Tax Act[1]ring-fences losses incurred by natural persons from certain trades under specific circumstances. If applicable, the natural person will not be […]
Income and a “Rule of Thumb”
Back in 1782, James Gillray published a satirical cartoon “Judge Thumb”. The cartoon lambastes a certain Sir Francis Buller, an English judge, for allegedly ruling that a man may legally beat his wife, provided that he used a stick no thicker than his thumb, although there is no other written record of Buller making such a pronouncement […]