The Resource Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61

Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61

Label
Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61
Title
Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61
Contributor
Subject
Language
eng
Summary
Judgment by the Supreme Court of Appeal of South Africa, judgment date 8 May 2012. Tradehold was a company registered and resident in South Africa. Its only asset was its 100% shareholding in a Guernsey company. Tradehold's board of directors decided that all further board meetings would be held in Luxembourg. As from that decision, Tradehold became effectively managed in Luxembourg. It nevertheless remained a resident of South Africa by reason of the definition, at that time, in the Income Tax Act 1962. This status changed in February 2003 when the definition was amended and Tradehold ceased to be a resident of South Africa. Under domestic law, a company which ceased to be resident was deemed to have disposed of all its assets and then immediately to have reacquired them. The Revenue assessed Tradehold for tax on the deemed disposal of the asset. Tradehold appealed arguing that under the South Africa-Luxembourg double taxation agreement (DTA) it was deemed to be a resident of Luxembourg at the time of the deemed disposal and under art 13 (4) of the DTA an alienation of assets was taxable only in the state of residence. The Revenue argued that the word 'alienation' referred only to an actual disposal of assets and not to a deemed disposal. The court of appeal concludes that the term 'alienation' in the capital gains article of the South Africa-Luxembourg DTA includes a deemed proposal of assets. This is based on the term having a broader meaning, not limited to actual alienations
Citation source
In: International tax law reports. - London. - Vol. 14 (2012),
Language note
English
http://library.link/vocab/relatedWorkOrContributorName
Baker, P
http://library.link/vocab/subjectName
  • case law
  • allocation of taxing rights
  • treaty interpretation
  • capital gains tax
  • disposal
Label
Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61
Instantiates
Publication
Label
Commissioner for the South African Revenue Service v Tradehold Ltd : [2012] ZASCA 61
Publication

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