Before the Honourable Mr Justice D Davis- President Mr H Kajie - Accountant Member Mr R B Justus - Commercial Member Case no. 11134 (Heard in Cape Town on 17 November 2004)
The taxation of an ex gratia payment received by appellant as an option holder of certain options in an employee share incentive scheme led to the present appeal.
It was common cause that the appellant held the option as a capital asset with the intention of exercising the option in order to acquire shares as a capital asset once he was in a position to so do.
Held that the issue for determination was whether the ex gratia amount which was received by appellant constituted "gross income" in his hands in terms of the provisions of the Income Tax Act 58 of 1962.The court found that the causal factor for the receipt of the payment by the appellant was his employment. The payment was therefore income, and the appeal was dismissed.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.