S.L. 123.92 Art. 21Determination of profits.

(1) Except as is otherwise provided in the Act or in other rules under the Act, when the tax chargeable in respect of a transfer of property is determined by reference to the profits derived from that transfer, these rules shall apply for the purpose of determining the respective chargeable income.

(2) Subject to sub-rule (4), when the tax in respect of a transfer of property is chargeable under article 5A of the Act, the profits that a company is required to allocate to the final tax account shall be equal to the consideration for that transfer after deducting:

(a) the acquisition value and brokerage fees, if any, determined in accordance with these rules;

(b) the development, administrative and other costs determined in accordance with rule 20; and

(c) the tax chargeable on the property transfer in terms of article 5A of the Act.

(3) Subject to sub-rule (4), in the case of a transfer of property which gives rise to profits on which tax is chargeable in terms of article 27G of the Act, the amount that a company is required to allocate to the final tax account shall be equal to the profit on that transfer as determined in accordance with sub-article (2) of the said article after deducting the tax chargeable on that profit.

(4) The amount to be allocated to the final tax account in terms of sub-rules (2) or (3) shall in no case be less than zero.