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Income Tax Act, 1962 (Act No. 58 of 1962)

Regulations

Regulations in terms of section 12T(8) of the Income Tax Act, 1962, on the requirements for Tax Free Investment

Part II : Issue of financial instrument and policy

4. Accepting of amounts by product provider

 

(1) A product provider may not accept any amount contributed in respect of any investor in respect of a tax free investment in excess of  the annual contribution limit and the lifetime contribution limit, subject to subregulations (3) and (4).

 

(2) For the purposes of calculating the amounts contemplated in subregulation (1), where any amount is transferred in respect of a tax free investment the total amount of contributions in respect of the tax free investment from which the amount is being transferred and amounts contributed into any other tax free investment from which amounts were transferred into the tax free investment from which the amount is being transferred—
(a) contributed during the year of assessment during which the amount is transferred must be taken into account as a contribution in respect of the annual contribution limit in respect of that year of assessment; and
(b)
(i) contemplated in paragraph (a); and
(ii) contributed in years of assessment prior to the year of assessment contemplated in paragraph (a),

must be taken into account as a contribution in respect of the lifetime contribution limit.

 

(3) Where—
(a) any amount is transferred in respect of a tax free investment and subregulation (2)(a) applies to that transfer, and
(b) the sum of the amounts contemplated in subregulation (2)(a) and the amounts contributed in respect of the tax free investment to which the amounts are transferred in that year of assessment is equal to or exceeds the amount of the annual contribution limit, the product provider to whom an amount is transferred may accept the amount transferred despite subregulation (1) but that product provider may not accept any other amount as a contribution in respect of that year of assessment in respect of that tax free investment.

 

(4) Where—
(a) any amount is transferred in respect of a tax free investment and subregulation (2)(b) applies to that transfer; and
(b) the sum of the amounts contemplated in subregulation (2)(b) and the amounts contributed in respect of the tax free investment to which the amounts are transferred exceeds the amount of the lifetime contribution limit, the product provider to whom an amount is transferred may accept the amount transferred despite subregulation (1) but that product provider may not accept any other amount as a contribution in respect of that tax free investment.

 

[Regulation (4) substituted by regulation 4 of Notice No. R. 309 of 2017]