Section 12E(4)(c) "Investment Income" (iii) 1. Do the following proceeds also qualify as investment income: 1.1 Proceeds from selling a plot in a township development? 1.2 Proceeds from townhouse development whereby the units are sold by the de
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
In terms of section 10(1)(zJ) of the Income Tax Act any amount received by or accrued to or in favour of a registered micro business as defined in the Sixth Schedule, from the carrying on of a business in the Republic, other than an amount received by or accrued to a natural person registered as a micro business that constitutes—
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investment income as defined in paragraph 1 of the Sixth Schedule; or
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remuneration as defined in the Fourth Schedule.
If the person is a natural person that is a registered micro business, he or she will only be a provisional taxpayer if the investment income or other taxable income exceeds the tax threshold. We accept that the individual doesn’t carry on another business.
If the micro business is a company it would have to file the provisional tax returns.