The answer to this query is based on legislation as at 2014/04/10.
Q: Following the introduction of the mark to market taxation event
in 2012 in respect of long term insurers, no depreciation allowances were
allowed in respect of real estate assets. Was the omission of depreciation
allowances for assets intended to be permanent, and does it also relate to new
assets brought into use by the relevant insurance funds post Feb 2013?
prohibition on the deduction of depreciation allowances that you refer to is
found in section 29A(11)(h). It reads as follows: In
the determination of the taxable income derived by an insurer in respect of its
individual policyholder fund, its company policyholder fund and its corporate
fund in respect of any year of assessment no amount may be deducted by way of
an allowance in respect of an asset as defined in the Eighth Schedule.
is no indication that this was meant to be a temporary one. When section
29A(11)((h) was amended in 2013 the Explanatory Memorandum stated the
insurers currently may not claim allowances (e.g. depreciation for buildings).
This proposed amendment, permits allowances in respect of financial instruments
(e.g. bad debt allowances).”
prohibition therefore also applies to assets brought into use post February
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.