Page 136 - P6 Slide - Taxation - Lecture Day 1

Exceptions to par 12A

• Reduction or discharge of debt

1.Deceased estate reduce debt owed to it by heir\legatee and
reduction forms part of “property”

2.Reduction qualifies as a donation\ s58

3.Fringe benefit ito 7th Schedule par 2(h)

4.Debtor and creditor are members of the same group of companies,

unless –

• debt acquired directly / indirectly from 3rd party not a member of

the group; or

• they became part of the same group after the debt arose,

AND

• these transactions were part of a scheme to avoid tax

136