Page 106 - P6 Slide Taxation - Lecture Day 7 - Various Topics

Calculation of the rebate

• After the above two limitations have been applied, an overall

limitation must be applied. The total rebate to be tested against
the overall limit is equal to the total of

 the foreign tax on capital gains after application of the above
limitation

 the foreign tax in respect of proportional amounts of net income
included in the resident’s taxable income after application of the

above limitation, and

 all other qualifying foreign taxes.

This total rebate is limited to the South African normal tax payable in

respect of the amounts included in the resident’s taxable income that

qualifies for a rebate (see s 6 quat (1) above). This limitation is
calculated as:

X=A x (b/c)

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