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Farming and manufacturing: The tax consequences of conducting these activities simultaneously
Different tax rules apply to farming and manufacturing activities respectively, and it appears that the South African Revenue Service (SARS) applies an arbitrary practice in determining whether, and if so, at what point a farming operation needs to be distinguished from manufacturing activities. Thi...
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| Format: | Thesis |
| Language: | English |
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Department of Finance and Tax
2019
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| _version_ | 1867613191357333504 |
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| access_status_str | Open Access |
| author | Grotepass, Debora Anneke |
| author2 | Roeleveld, Jennifer |
| author_browse | Grotepass, Debora Anneke Roeleveld, Jennifer |
| author_facet | Roeleveld, Jennifer Grotepass, Debora Anneke |
| author_sort | Grotepass, Debora Anneke |
| collection | Thesis |
| description | Different tax rules apply to farming and manufacturing activities respectively, and it appears that the South African Revenue Service (SARS) applies an arbitrary practice in determining whether, and if so, at what point a farming operation needs to be distinguished from manufacturing activities. This dissertation explores how and when a taxpayer is required to distinguish between farming and manufacturing activities within the context of a single business i.e. when one form of 'trade’ comes to an end, and when another form of 'trade’ commences. The First Schedule to the Income Tax Act, 1962 (ITA), and paragraph 12, in particular, gives certain privileges to farmers that other taxpayers do not enjoy. Similar to this, taxpayers who are conducting manufacturing activities, or operations accepted and listed by SARS as a process of manufacture or similar process, enjoy advantageous allowances in respect of the write off of machinery and buildings. Thus, the point at which one activity ends and the next activity begins can have significant tax consequences. This dissertation argues that these consequences are too significant to be governed by arbitrary decisions. In conclusion it is shown that the ITA provides the wherewithal to enable the decisions to be made based on sound statutory principles. Where the wherewithal is not present, appropriate additions to the legislation are recommended. Examples from case law are also discussed from which general principles to be used in practice are developed. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/29560 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:32:13.078Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2019 |
| publishDateRange | 2019 |
| publishDateSort | 2019 |
| publisher | Department of Finance and Tax |
| publisherStr | Department of Finance and Tax |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/29560 Farming and manufacturing: The tax consequences of conducting these activities simultaneously Grotepass, Debora Anneke Roeleveld, Jennifer Surtees, Peter South African Taxation Different tax rules apply to farming and manufacturing activities respectively, and it appears that the South African Revenue Service (SARS) applies an arbitrary practice in determining whether, and if so, at what point a farming operation needs to be distinguished from manufacturing activities. This dissertation explores how and when a taxpayer is required to distinguish between farming and manufacturing activities within the context of a single business i.e. when one form of 'trade’ comes to an end, and when another form of 'trade’ commences. The First Schedule to the Income Tax Act, 1962 (ITA), and paragraph 12, in particular, gives certain privileges to farmers that other taxpayers do not enjoy. Similar to this, taxpayers who are conducting manufacturing activities, or operations accepted and listed by SARS as a process of manufacture or similar process, enjoy advantageous allowances in respect of the write off of machinery and buildings. Thus, the point at which one activity ends and the next activity begins can have significant tax consequences. This dissertation argues that these consequences are too significant to be governed by arbitrary decisions. In conclusion it is shown that the ITA provides the wherewithal to enable the decisions to be made based on sound statutory principles. Where the wherewithal is not present, appropriate additions to the legislation are recommended. Examples from case law are also discussed from which general principles to be used in practice are developed. 2019-02-18T09:12:23Z 2019-02-18T09:12:23Z 2018 2019-02-18T09:03:07Z Master Thesis Masters MCom http://hdl.handle.net/11427/29560 eng application/pdf Department of Finance and Tax Faculty of Commerce University of Cape Town |
| spellingShingle | South African Taxation Grotepass, Debora Anneke Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| thesis_degree_str | Master's |
| title | Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| title_full | Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| title_fullStr | Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| title_full_unstemmed | Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| title_short | Farming and manufacturing: The tax consequences of conducting these activities simultaneously |
| title_sort | farming and manufacturing the tax consequences of conducting these activities simultaneously |
| topic | South African Taxation |
| url | http://hdl.handle.net/11427/29560 |
| work_keys_str_mv | AT grotepassdeboraanneke farmingandmanufacturingthetaxconsequencesofconductingtheseactivitiessimultaneously |