Gross Income

Question 1

People ‘s stores

Answer 1

Accurued to =entitled to
Included in gross income when entitled to not when youreceive the money
Accrual =face value not discounted value

Question 2

MP finance

Answer 2

Even though the receipts are illegal, they are still received, and therefore they are included in gross Income

Question 3

Delagoa bay cigarette

Answer 3

The legality of the income is irrelevant. The amount will be gross income

Question 4

George forest Timber

Answer 4

All assets are either fixed or floating capital

Question 5

Pick n Pay employee share purchase trust

Answer 5

The scheme of profit making is essential to classify proceeds as revenue

Question 6

Natal estate Ltd

Answer 6

A taxpayer needs to be careful not to cross the Rubicon and embark on a scheme of profit making

Question 7

Wj fourie beleggings

Answer 7

Compensation for damages of capital assets =capital

Compensation for loss of profit /income=in o. E

Question 8

Nussbaum

Answer 8

The secondary purpose of a taxpayer could taint the primary purpose of a taxpayer, considering the frequency

Question 9

Visser

Answer 9

Income is what capital produces

Tree VS fruit comparison

Question 10

Richmond estate

Answer 10

A company’s initial intention is indicated by the actions of the director, types of business and the MOI

Question 11

Cohen

Answer 11

A person is ordinarily resident in the country to which he intends to *return from his wandering. The Country he Regards as his real home

Question 12

KUTTEL

Answer 12

A person is ordinarily resident where the person is habitually and normally resident.

Question 13

Lategan

Answer 13

The word amount includes any form of property with an ascertainable monetary value, including debt and rights

Question 14

Butcher bros

Answer 14

The onus is on Sars to determine the amount

Question 15

Brummeria

Answer 15

The question whether a receipt or accrual in a form other than. Money has a money value is the primary question.
The test is objective and not subjective

Question 16

Witwaterand association of racing clubs

Answer 16

Amount accues to a taxpayer if the taxpayer has no legal obligation to pay it over

Question 17

Mooi

Answer 17

Accrued to =unconditionally entitled to the amount

Question 18

Geldenhuys

Answer 18

The amount is only included in gross income by a taxpayer only if it is received by him on his own behalf, for his own benefits

Question 19

MP finance group cc

Answer 19

A bilateral receipt that is used for your own intentions means it has been received by you

Question 20

Pyott Ltd

Answer 20

Generally deposits are still received and form part of gross income
A deposit is only treated as not being received if the money is kept separately in a trust account for the benefit of the customer

Question 21

Visser

Answer 21

Income may be described as the product person’s wits and energy
Tree VS fruits

Question 22

Nel

Answer 22

Kruger rands are unique asset where the only income earned is through sale. Therefore it will normally be seen as capital unless it is your trade to buy and sell them

Question 23

Levy

Answer 23

If the are mixed intention, on needs to determine the dominant intention

Question 24

Elandsheuwel farming

Answer 24

The intention of the shareholder should be taken into consideration when assessing whether the use of the asset is capital in nature
Thus, a change in shareholding could represent a Change in intention.

Question 25

Stott

Answer 25

Consider the taxpayer’s dominant intention. The fact that the asset is sold at a profit, does not necessarily indicate a change of intention

Question 26

John bell

Answer 26

The mere decision to sell an asset does not change an intention. A capital asset may be realised at its best advantage

Question 27

Berea west estates

Answer 27

The receipts of the realization company are capital In nature

Question 28

Founders hill (pty) Ltd

Answer 28

There has to be a real justification for the realization company to be formed
By merely selling an asset through a realization company does not make the proceeds capital in nature

Question 29

Stellenbosch farmers winery

Answer 29

Compensation for cancelation of a contract to an income earning right will be considered capital in nature