TAX2601/103/3/2020
TAX 2022
REVIEWED
Tutorial Letter 103/3/2020
PRINCIPLES OF TAXATION
TAX2601
Both semesters
Department of Taxation
Bar code
, TAX2601/103
IMPORTANT INFORMATION:
Please register on myUnisa, activate your myLife e-mail address, and ensure that you
have regular access to the TAX2601-20-S1 OR TAX2601-20-S2 module site on
myUnisa, depending on which semester you are registered for.
Note: This is an online module; therefore, your module is available on myUnisa. However, in order to
support you with your studies, you will also receive certain study material in printed format.
, TAX2601/103
CONTENTS
Page
1. LEARNING UNIT 5 5
5.1 Background.................................................................................................................................7
5.2 General deduction formula ..........................................................................................................7
5.3 Specific deductions ...................................................................................................................12
5.4 Prohibited deductions ...............................................................................................................16
5.5 Prepaid expenses .....................................................................................................................17
5.6 Trading stock ............................................................................................................................17
5.7 Conclusion and integrated question ..........................................................................................19
2. LEARNING UNIT 6 ...................................................................................................................27
6.1 Background...............................................................................................................................29
6.2 Repairs and improvements .......................................................................................................30
6.3 Capital allowances – Movable assets........................................................................................31
6.4 Building allowances – Immovable assets ..................................................................................34
6.5 Disposal of assets that were subject to an allowance ................................................................36
6.6 Leased assets...........................................................................................................................38
3. LEARNING UNIT 7 ...................................................................................................................47
7.1 Background...............................................................................................................................49
7.2 Identify whether CGT is applicable ............................................................................................50
7.3 Basic framework and CGT rates ...............................................................................................51
7.4 Proceeds ..................................................................................................................................51
7.5 Base cost ..................................................................................................................................52
7.6 Capital gain and capital loss .....................................................................................................57
7.7 Exclusions per asset .................................................................................................................58
4. SELF-ASSESSMENT – SOLUTIONS FOR EACH LEARNING UNIT .......................................65
3|Page
, TAX2601/103
NOTES
4|Page
TAX 2022
REVIEWED
Tutorial Letter 103/3/2020
PRINCIPLES OF TAXATION
TAX2601
Both semesters
Department of Taxation
Bar code
, TAX2601/103
IMPORTANT INFORMATION:
Please register on myUnisa, activate your myLife e-mail address, and ensure that you
have regular access to the TAX2601-20-S1 OR TAX2601-20-S2 module site on
myUnisa, depending on which semester you are registered for.
Note: This is an online module; therefore, your module is available on myUnisa. However, in order to
support you with your studies, you will also receive certain study material in printed format.
, TAX2601/103
CONTENTS
Page
1. LEARNING UNIT 5 5
5.1 Background.................................................................................................................................7
5.2 General deduction formula ..........................................................................................................7
5.3 Specific deductions ...................................................................................................................12
5.4 Prohibited deductions ...............................................................................................................16
5.5 Prepaid expenses .....................................................................................................................17
5.6 Trading stock ............................................................................................................................17
5.7 Conclusion and integrated question ..........................................................................................19
2. LEARNING UNIT 6 ...................................................................................................................27
6.1 Background...............................................................................................................................29
6.2 Repairs and improvements .......................................................................................................30
6.3 Capital allowances – Movable assets........................................................................................31
6.4 Building allowances – Immovable assets ..................................................................................34
6.5 Disposal of assets that were subject to an allowance ................................................................36
6.6 Leased assets...........................................................................................................................38
3. LEARNING UNIT 7 ...................................................................................................................47
7.1 Background...............................................................................................................................49
7.2 Identify whether CGT is applicable ............................................................................................50
7.3 Basic framework and CGT rates ...............................................................................................51
7.4 Proceeds ..................................................................................................................................51
7.5 Base cost ..................................................................................................................................52
7.6 Capital gain and capital loss .....................................................................................................57
7.7 Exclusions per asset .................................................................................................................58
4. SELF-ASSESSMENT – SOLUTIONS FOR EACH LEARNING UNIT .......................................65
3|Page
, TAX2601/103
NOTES
4|Page
