n Tax Breaks Newsletter - Can interest be 'capital' and therefore not deductible? : from the courts

Volume 2006, Issue 246
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Extracted from text ... July 2006 5 FROM THE COURTS Can interest be 'capital' and therefore not deductible? By KATHY THERSBY THE SOUTH African courts have suggested, on a few occasions, that an outlay of interest may in certain circumstances be "of a capital nature" and therefore not qualify as a deductible expense in terms of section 11(a) of the Income Tax Act, says PricewaterhouseCoopers in a recent issue of Synopsis. They cite the example of the dissenting judgment of Van Wyk AJA in CIR v Drakensberg Garden Hotel (Pty) Ltd 1960 (2) SA 475 (A), 23 SATC 251 at 260. Many business ..

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