1887

n Without Prejudice - Not all hybrids are cost effective : tax

Volume 15, Issue 2
  • ISSN : 1681-178X
USD

 

Abstract

While most taxpayers were participating in the festivity of April Fool's Day on 1 April 2014, the not-so-funny amending provisions to s8F of the Income Tax Act (58 of 1962) became effective. The implication is that any interest incurred on or after that date, in respect of a "hybrid debt instrument", will be deemed to be a dividend declared and paid by the company on the last day of the year of assessment. It is not deductible for income tax purposes. This may have unintended tax consequences where the holder of the instrument is not a shareholder of the issuer.

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/content/jb_prej/15/2/EJC169047
2015-03-01
2016-12-11

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