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Income Tax Act, 1962 (Act 58 of 1962)

Chapter II: The Taxes

Part I: Normal Tax

11A. Deductions in respect of expenditure and losses incurred prior to commencement of trade

 

(1) For purposes of determining the taxable income derived during any year of assessment by a person from carrying on any trade, there shall be allowed as a deduction from the income so derived, any expenditure and losses—
(a) actually incurred by that person prior to the commencement of and in preparation for carrying on that trade;
(b) which would have been allowed as a deduction in terms of section 11 (other than section 11(x)), 11B, 11D, or 24J, had the expenditure or losses been incurred after that person commenced carrying on that trade; and
(c) which were not allowed as a deduction in that year or any previous year of assessment.

 

(2) So much of the expenditure and losses contemplated in subsection (1) as exceeds the income derived during the year of assessment from carrying on that trade after deduction of any amounts allowable in that year of assessment in terms of any other provision of this Act, shall not be set off against any income of that person which is derived otherwise than from carrying on that trade, notwithstanding section 20(1)(b).