Interpretation Notes

The Interpretation Notes (INs) on this page are older versions of the existing ones, which had been either replaced or withdrawn. They are intended for research and reference purposes only and should not be relied on to make decisions on current legislation.

Interpretation Notes that are still in operation can be found under Interpretation Notes

​IN NumberDescription​ and previous issues​​Applicable Legislation ​
​IN 1​

​Provisional tax estimates​

​Income Tax Act, 1962​​Paragraphs 17 to 27 of the Fourth Schedule​​
​IN 2

​Foreign dividends: Deductibility of interest

 ​Income Tax Act, 1962

Section 11C

IN 3​

​Resident: Definition in relation to a natural person – ordinarily resident

Income Tax Act, 1962​​Section 1
​IN 4

​Resident: Definition in relation to a natural person – physically present

Income Tax Act, 1962​​Section 1
​IN 5

​Employees’ Tax: Directors of private companies (which include persons in close corporations who perform functions similar to directors of companies)

Income Tax Act, 1962​​​Paragraphs 1, 9(5) and 11C of the Fourth Schedule
​IN 6

Resident: ​Place of effective management (persons other than natural persons)

Income Tax Act, 1962​Section 1​
IN 8

Insolvent estates

Income Tax Act, 1962​​​Section 25C​
​IN 9

​Small Business Corporations

Income Tax Act, 1962​​​Section 12E​
​IN 10

​Skills development levy exemption: Public benefit organisations

Skills Development Levies Act, ​1999​​Section 4(c)
​IN 11

Trading Stock: Assets not used as trading stock

Income Tax Act, 1962​

Sections 1 and 22​

From Issue 2:
Paragraph (jA) of the definition of “gross income” in section 1(1)

​IN 12

​Recoupment: Assets in a deceased estate

  • The legislative provisions dealing with deceased estates in the Income Tax Act, 1962 (the Act) has been amended​ with effect from 1 March 2016
Income Tax Act, 1962​​Sections 8(4) and
​IN 13

​Deductions: Limitation of deductions for employees and office holders

Income Tax Act, 1962​Section 23(m)
IN 14​

​Allowances, advances and reimbursements

Income Tax Act, 1962​​

Section 8(1)(a) and (c)​

From Issue 3:
Section 8(1)(a), (b) and (c) and paragraph 1 of the Fourth Schedule​

IN 15​

​Exercise of discretion in case of late objection or appeal

Tax Administration Act, 2011​​Sections 104, 106 and 107
​IN 16

​Exemption from income tax: foreign employment income

Income Tax Act, 1962​Section 10(1)(o)(ii)​
​IN 17

​Employees Tax: Independent contractors

Income Tax Act, 1962​​​Fourth Schedule​
​IN 18

​Rebate and deduction for foreign taxes on income

Income Tax Act, 1962​​​

Section 6quat​

Title changed from Issue 2

Sections 6quin and 64N added to Issue 3

​​IN 19
​Year of assessment: Accounts accepted to date other than the last day of February
Income Tax Act, 1962​​​​
Section 1 – definition of “year of assessment”,
sections 5, 66(13A) and (13B) and 89quat and paragraph 21 of the Fourth Schedule​

​IN 20

​Additional deduction for learnership allowance

Income Tax Act, 1962​​​Section 12H​
​IN 22

​Exemption: Public Benefit Organisations and Statutory Bodies

Transfer Duty Act, 1949Section 9(1)(c) and (1A)​
​IN 23

​Estimated assessments (foreign funds or assets)

Income Tax Act, 1962​​​​Section 78(1A), (1B) and (1C)​
​IN 24

​Public Benefit Organisations: Trading rules – partial taxation of trading receipts

Income Tax Act, 1962​​​​​Section 10(1)(cN)
IN 25​

​Resident: Definition in relation to a natural person – application of the physical presence test in the year of death or insolvency

Income Tax Act, 1962​​​​Section 1 – definition of “resident”​
IN 27​

​Personal liability of employers, representative employers, shareholders and directors for outstanding employees’ tax

  • Issue 1 – replaced on 4 February 2005 [Currently unavailable]
Income Tax Act, 1962​​​​Fourth Schedule​
​IN 28

​Deductions: Home office expenses incurred by persons in employment or persons holding an office

Income Tax Act, 1962​​Sections 11(a), 23(b) and (m)
​IN 29

​Farming operations: Equalised rates of tax

Income Tax Act, 1962​Section 5(10)
Paragraph 19 of the First Schedule​
​IN 30

​Documentary proof required on consignment of delivery of movable goods to a recipient at an address in an export country


The name of this IN changed in Issue 3 to:

The supply of movable goods as contemplated in section 11(1)(a)(9) read with paragraph (a) of the definition of “exported” and the corresponding documentary proof

Value-Added Tax Act, 1991​Section 1 – paragraph (a) of the definition of “exported”
Sections 11(1)(a)(i) and
​IN 31

​Documentary proof required for the zero-rating of goods and services

Value-Added Tax Act, 1991​​Section 11(3)​
​IN 32

​Public Benefit Organisations: Prudent investments

(Refer to section 24(d) of Revenue Laws Amendment Act, 2006 (Act No. 20 of 2006)

Income Tax Act, 1962​​Section 30(3)(b)(11)(cc)​
​IN 33

​Assessed losses: Companies – The “trade” and “income from trade” requirements

Income Tax Act, 1962​Section 20(1)(a)​
​IN 34

Exemption from income tax : remuneration derived by a person as an officer or crew member of a ship

​Income Tax Act, 1962Section (1)(o)(i)​
IN 35​

​Employees’ Tax: Personal service providers and labour brokers

Income Tax Act, 1962​Paragraphs 1, 1(1A) and 2(5) of the Fourth Schedule and section 23(k)
​IN 36

​Scope and impact of section 76I upon written statements issued by the Commissioner prior to 1 October 2006

Income Tax Act, 1962​Section 76I​
​IN 37

​Procedures for requesting binding effect in respect of written statements issued by the Commissioner prior to 1 October 2006

Income Tax Act, 1962​​Section 76I(4) and (5)
IN 38​

​Application and cost recovery fees for binding private rulings

Income Tax Act, 1962​​Section 76 F​
​IN 39

​VAT treatment of public authorities, grants and transfer payments

Value-Added Tax Act, 1991​​Sections 1, 8, 11, 16, 18, 23 and 40A
IN 40​

​VAT treatment of the supply of goods and/or services to and/or from a customs controlled area of an industrial development zone

Value-Added Tax Act, 1991​​​Sections 1, 7, 8, 9, 10, 11, 13, 19
Item 498.00 in paragraph 8 of Schedule 1
IN 41​

​Application of VAT to the gambling industry

Value-Added Tax Act, 1991​​​Sections 1, 8(13) and (13A),
9(3)(e), 16(3)(a), (d) and (e), 17(2)(a) and (c), 72​
​IN 42

​The supply of goods or services by the travel and tourism industry

Value-Added Tax Act, 1991​​​​Sections 1, 7 and 11​
​IN 43

​Circumstances in which amounts received or accrued on disposal of listed shares are deemed to be of a capital nature

Income Tax Act, 1962​

Section 9B​

Section 9C (as from Issue 3)

IN 44​

Public Benefit Organisations: Capital Gains Tax (CGT)

​Income Tax Act, 1962​Paragraph 63A of the Eighth Schedule
​IN 45

​Deduction of Security Expenditure

​Income Tax Act, 1962Sections 11(a) and (e),
22(8), 23(b) and (g), 24D and paragraphs 20 and 53 of the Eighth Schedule​
​IN 46

​Amalgamation of amateur and professional sporting bodies

Sections were amended by section 125 of Revenue Laws Amendment Act, 2007 as substituted by section 76(1) of Taxation Laws Amendment Act, 2008 and amended by section 132 of Revenue Laws Amendment Act, 2008
The conditions and requirements relating to the amalgamation transactions as explained in the Note are no longer relevant, as the period within which the amalgamation transactions had to be completed, has lapsed on 31 December 2012
Income Tax Act, 1962​Sections 10(1)(cN), 11, 11E
and 30 as amended​
IN 47​

​Wear-and-tear or depreciation allowance

Income Tax Act, 1962​​Section 11(e)
​IN 48

​Instalment Credit Agreements and Debtors’ Allowance

Income Tax Act, 1962​Section 24​
​IN 49

​Documentary proof required to substantiate a vendor’s entitlement to “input tax” or a deduction as contemplated in section 16(2)

The Interpretation Note will be incorporated into an Interpretation Note setting out the required documentary proof to be obtained and retained by a vendor to substantiate the vendor’s entitlement to a deduction under section 16(3)(c)-(n).

Value-Added Tax Act, 1991​​​​Section 1 – definition of the term “input tax; read with
section 16(1), (2) and (3)​
IN 51​

​Pre-trade expenditure and losses

Income Tax Act, 1962​​Sections 11, 11A and 23
​IN 52

​Tax periods

Value-Added Tax Act, 1991​​​​Section 27​(6); proviso (ii) and proviso (iii)
IN 53​

​Limitation of allowances granted to lessors of affected assets

Income Tax Act, 1962​​​Section 23A
IN 54​

​Deductions – Corrupt Activities Fines and Penalties

​Income Tax Act, 1962Section 23(o)(i) and (ii)​
​IN 55

​Taxation of directors and employees on vesting of equity instruments

Income Tax Act, 1962​Sections 8C and 10(1)(nD)
Paragraph 11A of the Fourth Schedule
Paragraph 2(a) of the Seventh Schedule​
IN 56​

​Recipient-created tax invoices, credit and debit notes

Value-Added Tax Act, 1991​
​Sections 20(2) and

​IN 58

​The Brummeria case and the right to use loan capital interest free

Income Tax Act, 1962​Section 1 – definition of “gross income”​
IN 59

Tax implications of the receipt or accrual of government grants and government scrapping payments

Income Tax Act, 1962

Section 1 – Definition of  “gross income”, sections 10
and 23(n)

Title change from Issue 2 to “Tax Treatment of the Receipt or Accrual of Government Grants”

IN 60​

​Loss on disposal of depreciable assets

Income Tax Act, 1962​​Sections 11(o), 20B and 24M​
IN 63​

Rules for the translation of amounts measured in foreign currencies

Income Tax Act, 1962​Sections 1, 6quat, 9A, 9D(6), 9G and 25D
​IN 64

​Income Tax exemption: Bodies Corporate established under the Sectional Titles Act, No. 95 of 1986, Share Block Companies established under the Share Blocks Control Act, No. 59 of 1980 and Associations of persons managing the collective interests common to all members

Income Tax Act, 1962​Section 10(1)(e)
IN 65​

​Trading Stock: Inclusion in income when applied, distributed or disposed of otherwise than in the ordinary course of trade

Income Tax Act, 1962​​Section 22(8)​
IN 67​

​Connected persons

Income Tax Act, 1962​​​Section 1 – definition of  “connected person”​
​IN 68

​Provisions of the Tax Administration Act, 2011, that did not commence on 1 October 2012 under Proclamation 51 in Government Gazette 35687

Tax Administration Act, 2011​​Chapter 12 and Schedule 1
​IN 69

Game farming

Income Tax Act, 1962​​Section 26 and First Schedule​
IN 70

Supplies made for no consideration

Value-Added Tax Act, 1991
Section 1 Definitions of “enterprise”, “taxable supply”, “input tax”, “donation” and “consideration”, section 10(4) and
​IN 73

​Tax implications of rental income from tank containers

Income Tax Act, 1962​Sections 11(a), 11(e), 20(1), 23A and 25D​
IN 74​

​Deduction and recoupment of expenditure on repairs

Income Tax Act, 1962​Sections 22(d) and
​IN 75

​Exclusion of certain companies and shares from a “group of companies” as defined in section 41(1)

​Income Tax Act, 1962​Sections 1(1) and 41(1)
IN 79​

​Produce held by nursery operators

​Income Tax Act, 1962Sections 25, 25C and 26 and Paragraphs 2, 3, 4 and 9 of the First Schedule and Paragraph 40 of the Eighth Schedule
​IN 81

​Supply of goods and services by professional hunters and taxidermists to non-residents

Value-Added Tax Act, 1991​​Sections 7(1)(a),
11(1)(a) and 11(2)(l)​
​IN 83

​Application of sections 20(7) and 21(5)

Value-Added Tax Act, 1991​​​Sections 20(4), (5), (7),
21(1) and (5)​
IN 86​

Additional investment and training allowances for industrial policy projects​

Income Tax Act, 1962​​Section 12I​
​IN 87​

​Headquarter companies

Income Tax Act, 1962​​

From Issue 2

Sections 1(1) – Definition of “headquarter company” and 9I, 6quat(1A) and (1C), 9D(2), 9H, 9I, 10(1)(k)(i), 10B, 20C, 24I(3), 25D(4) and (7), 31(5), 41(1) – Definition of “company”, 49D(c),
50D(1)(a)(i)(cc) and
64E(1); and
paragraphs 11(2)(b), 43(1A) AND (6A) and 64B(2) and (4) of the Eighth Schedule​​

IN 90​​
​Year of assessment of a company: Accounts accepted to a date other than the last day of a company’s financial year
Income Tax Act, 1962​Sections 1(1), Definition of “financial year” and “year of assessment”, 5, 66(13C), 89quat(1) and paragraph 23 of the Fourth Schedule​
IN 91
Reduction of debt
Income Tax Act, 1962Section 19 and paragraph 12A of the Eighth Schedule
​​​IN 93

The taxation of foreign dividends

Income Tax Act, 1962​​​​Sections 1(1) – Definition of “foreign dividend”, 6quat,
9(4)(a), 9D(9)(f), and 10B, 22(3)(a)(iii), 23(f), 23(q) and 25D and
paragraph 20(1)(h)(iii) of the Eighth Schedule​
​​IN 95​

Deduction for energy-efficiency savings

Income Tax Act, 1962​​​Section 12L​
​​​IN 97

​Taxation of REITs and controlled companies

Income Tax Act, 1962​​​Sections 1(1) – Definition of “REIT”,  and 25BB (3)(d),
8FA(2) and (3)(d), 9C(2) and (5), paragraph (aa) of the proviso to
section 10(1)(k)(i), 11(a),
11(x), 23N(5), 24J(2), 41 to 47, 64E(1), 64F(1)(a) and (l) and (2), 64FA(1)(a); paragraph 20(3)(a) of the Eighth Schedule;
Sections 2(1) and 8(1)(t) of the Securities Transfer Tax Act; sections 1(1) – Definition of “residential property company”, 2(1) and 9(1)(l) of the Transfer Duty Act; and sections 2, 7(1)(a), 12(a) and 17(1) of the
Value-Added Tax Act​​
​IN 99​

​Unclaimed benefits

​Income Tax Act, 1962​​​​Paragraph 4(1) of the Second Schedule​​
IN 102

Classification of risk policy and the once-off election to transfer certain policies or classes of policies issued before 2016 to the Risk Policy Fund

Income Tax Act, 1962

Section 29A

Title change from Issue 2 to “Classification of Risk Policy” 

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