Does a mineral right constitute 'immovable property' for purposes of the Income Tax Act and double tax treaties?

Govender, Preshnee

Does a mineral right constitute 'immovable property' for purposes of the Income Tax Act and double tax treaties?

Master Thesis

2014

Publisher

University of Cape Town

Department

Department of Commercial Law

Faculty

Faculty of Law

Abstract

This research paper analyses the income tax impact for international (non-resident) companies that dispose of their shares in mining or oil and gas companies situated in South Africa. Typically, a disposal of shares by a non-resident in a property-rich company in South Africa would attract CGT. In the case of the minerals sector, it is automatically assumed that a mining or oil and gas company is a so-called “land-rich” or “property-rich” company due to the nature of its operations. This paper seeks to test that assumption, ie do shares in a mining or oil gas company whose only asset is a mining or prospecting right or exploration or production right respectively qualify as an ‘interest in immovable property’ as that term is defined in the ITA for CGT purposes? To make this determination, the term ‘immovable property’ as it is used for common –law purposes and the potential misalignment of this definition when compared to the term as it is used in the ITA must be analysed.

Description

Includes bibliographical references.

Keywords

Tax Law

Reference:

Collections

Masters

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