S.L. 123.193 Art. 6Capital gains.

(1) Where the investment in a qualifying company is disposed of within three years from the date of subscription to the equity shares by the qualifying investor, and where the qualifying investor qualified for benefits in terms of these rules relative to such investment, the tax due in respect of the income derived from such disposal shall be calculated on the basis of the higher of the market value of such investment and the consideration received by the qualifying investor and shall be charged to tax at the applicable rates as set out in article 56 of the Act. For the avoidance of doubt, the amount on which tax is chargeable in terms of this sub-rule shall not be reduced in any manner by the cost of acquisition of the investment, nor by any deduction or credit whatsoever.

(2) Where the investment in a qualifying company is disposed of after the lapse of three years from the date of subscription to the equity shares by the qualifying investor, any gains or profits derived from such disposal shall be exempt from any tax otherwise due in terms of the Act.