5.Specific types of farming
Duration: 1 hour
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At this point in your learning journey, you should understand that a person is taxed on his/her taxable income and that certain amounts are included in gross income, special inclusions, exempt income, deductions, etc.
Farmers are not treated differently from other individuals. A farmer’s income derived from farming operations is also included, along with his/her income derived from other sources of income, in the taxable income calculation for a specific year of assessment.
You should remember that section 26(1) of the Income Tax Act No.58 of 1962 (“the Act”), states that the taxable income of a person derived from carrying on pastoral, agricultural or other farming operations must be determined in accordance with the ordinary provisions of the Act, but this is subject to the provisions set out in the First Schedule of the Act. It merely means that a farmer will also be taxed under the ordinary rules of the Act unless the First Schedule´s specific provisions would apply because farming is in essence a trade, just a very specific one.
tax system in South Africa has evolved over many years by case law and in response to various geological, economic, social, and environmental challenges.
This study guide will only discuss the most basic requirements relating to the tax on mining-related operations.
The subtopics or units included in this topic are:
Competencies developed in this short course (self-paced)