Donations Tax

Question 1

Deemed Donation s58 (1)

Answer 1

Property sold & commissioner regards sale price adequate consideration
FV of Property - Consideration
Value - Selling price

Question 2

Donations made to spouse under ante- or postnuptial contract

Answer 2

s56 (1)(a)

Question 3

Benefit of trust where spouse is only beneficiary

Answer 3

s56 (1)(b)

Question 4

Donations of right of property outside SA

Answer 4

s56 (1)(g)

Question 5

Donatio mortis causa

Answer 5

s56 (1)(c)

Question 6

Donee receives no benefit before death of donor

Answer 6

s56 (1)(d)

Question 7

Donations cancelled within 6 months

Answer 7

s56 (1)(e)

Question 8

Donation made by public company

Answer 8

s56 (1)(n)

Question 9

Donation between companies within same group of companies

Answer 9

s56 (1)(r)

Question 10

Donation of RoU of farming property to donor’s child for no (in)adequate consideration

Answer 10

s56 (1)(m)

Question 11

Property disposed of under any trust

Answer 11

s56 (1)(l)

Question 12

Married in Community of Property:
Assets within joint estate

Answer 12

Each spouse donated half

Question 13

Married in Community of Property:
Assets not included in joint estate

Answer 13

Spouse donated on its own

Question 14

General Exemption

Answer 14

R100 000 for each spouse

Question 15

Donor (Natural Person)

Answer 15

General exemption of R100 000

Question 16

Donor (Not natural person)

Answer 16

General exemption of R10 000 (casual gifts)

Question 17

Value of property: Property other than restricted interets

Answer 17

• Fair MV at date of donation
• Property on which bona fide farming operations is conducted (Fair MV x 70%)

Question 18

Value of property: Restricted interests

Answer 18

• Fiduciary rights; Usufruct; Bare dominium; Annuities
• Donations tax can be reduced by donating usufruct & fiduciary rights seperately

Question 19

Calculate value of: Fiduciary right or Usufruct

Answer 19

1. FV of property (subject to limited interest)
2. Step 1 x 12%
3. Donor’s life expectancy
4. Donee’s life expectancy
5. Determine shorter period between Step 3 & Step 4, THEN determine applicable discounting factor
6. Value for donations tax purposes = Step 2 x Step 5

Question 20

Calculate value of: Bare dominium

Answer 20

1. Fair MV of property
2. Step 1 x 12%
3. Donee’s life expectancy
4. Applicable discounting factor per Table A
5. Value of Usufruct
6. Value of Bare dominium

Question 21

Donation to Approved PBO

Answer 21

s 56(1)(h)

Question 22

Donation to government

Answer 22

s 56(1)(h): (s 10(1)(a))

Question 23

Donation to advancing science

Answer 23

s 56(1)(h): (s 10(1)(cA))

Question 24

Donation to political parties

Answer 24

s 56(1)(h): (s 10(1)(cE)

Question 25

Donation to PBO

Answer 25

s 56 (1)(h): (s 10(1)(cN))

Question 26

Donation to clubs for relaxation

Answer 26

s 56 (1)(h): (s 10(1)(cO))

Question 27

Donation to small business funding entity

Answer 27

s 56(1)(h): (s 10(1)(cQ))

Question 28

Donation to pension funds

Answer 28

s 56 (1)(h): (s 10(1)(d))

Question 29

Donation ito trust

Answer 29

s 56(l)

Question 30

Donation of right to farm on farming property to child

Answer 30

s 56(m)

Question 31

Donation by public company

Answer 31

s 56(n)

Question 32

Donation by companies in same group as each other

Answer 32

s 56(r)

Question 33

Donation ito Land reform act

Answer 33

s 56(o)

Question 34

Donation ito maintenance of any person

Answer 34

s 56(2)(c)