Page 2 - 5.3 i. Taxation ITC Summarised Notes part 3
P. 2

ITC EXAM PREP



                   Interest-bearing instruments –s 24J








             • Deduction of interest:

                    • Deemed to be incurred ito s 24J(2) if incurred in the


                        production of income (and carrying on of a trade)


                           • must be deducted from income from issuer/borrower
             • Taxation of interest:


                    • Deemed to accrue ito s 24J(3) irrespective if it is of a


                        capital nature or not - must be included in gross

                        income of holder/lender


             • Use a timeline for accrual periods versus yearend

             • Yield to maturity - calculate













                                                                                                                                    2
   1   2   3   4   5   6   7