General Deduction CL Flashcards
Warner Lambert SA
Deductions are not allowed to be claimed as a deduction from income derived from trade to the extent to which such money’s were not expended for the purpose of trade.
Get a deduction to the extent that you expensed money for the purpose of trade
Burgess
The definition of trade should be given a wide interpretation and includes a venture
Port Elizabeth Electric Tramway
In order for an amount to be in the production of income, it needs to be closely linked to business operations
Joffe
Difference between expenditure and losses is not important. Expenditure (vs losses) is the (in)voluntary outgoing of funds that was (un)willingly incurred
For an amount to be in the production of income it must be a necessary concomitant of business operations
Drakensburg Gardens Hotel
Connection between the payment of interest and the production of income needs to be close for it to be deductible
Provider
Amounts paid by the employer to the employee Ito a service contract are deductible of it was incurred in the production of income
BPSA
Royalties are deductible if they were incurred in the production of income
Nemojin
Apportion expenditure that is general and relates to both GI and exempt income
Edgars Stores
There must be an unconditional and absolute legal obligation for the expense to have been incurred
Nasionale Pers Bpk
Provisions which are uncertain or contingent are not incurred
Golden Dumps
Disputed expenditure can only be deducted in the YOA that the outcome was resolved
Labat
Expenditure actually incurred
New State Areas
The payments do not produce any permanent asset for the company it is revenue in nature
Rand Mines
Expenditure will be of a capital nature if it provides an enduring benefit or adds to the income producing capacity of an entity
Sub-Nigel
The income does not have to be earned in the current year as long as the expenses relate to the income
