Page 26 - Capital Allowances Recoupments Part 1 (CTA)

SOLUTION:

• Co A is a private co;

• All holders of shares are natural persons during the full yoa;

• Gross income < R20 000 000 for the yoa;

• Although 100% (thus > 20%) receipts and accruals consists of the

rendering of a personal service, because IT services are personal

services, is the personal service requirement NOT APPLICABLE, due

to the fact that > 3 full-time employees were in service throughout

the whole yoa (excluding holders of shares or their connected

persons);

• Holders of shares' interest in any other entities?

– H/S no. 1, no problem, because share block co are allowed;

– H/S no. 2, a problem. Are allowed to have interest in a listed

company, but Co Z was delisted, creating the problem.

Conclusion:

Co A is not a SBC for the current yoa.