Income Tax Act, 1962 (Act 58 of 1962)
Department of Finance
Practice Note No. 44
Doubtful Debts: Exporters: Credit not Covered by Insurance
Date: 23 February 1996
Where a South African exporter sold capital goods on a medium or long term credit basis to purchasers in an export country and such credit was insured against all risks (both political and otherwise) with the Credit Guarantee Insurance Corporation, a doubtful debts allowance was granted to the exporter in terms of Section 11(j) of the Income Tax Act, on so much of the amount which was due to him at the end of his financial year in respect of the sales in question as was not covered by the insurance effected.
The practice is withdrawn with effect from 1 November 1995.
Exporters will, in future be required to furnish the same particulars in respect of export sales, which are regarded as doubtful as are required in respect of all other doubtful debts. The normal requirements of section 11(j) in respect of doubtful debts will, therefore, be applicable in future. The allowance will be granted on the same basis as all other doubtful debts.
Best Selling Products