ARTICLE · 02 AUGUST 2013

Limiting Interest Deductions

ENS

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In the 2013 Budget Speech, the Minister of Finance announced that restricting the deduction of excessive interest expenditure claimed by taxpayers in debt financing schemes has been on the tax policy agenda for a number of years and accordingly, legislative steps are now being taken to limit the interest deductions claimed by taxpayers in such schemes.

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In the 2013 Budget Speech, the Minister of Finance announced that restricting the deduction of excessive interest expenditure claimed by taxpayers in debt financing schemes has been on the tax policy agenda for a number of years and accordingly, legislative steps are now being taken to limit the interest deductions claimed by taxpayers in such schemes.

In terms of the media statement released by National Treasury on 29 April 2013, one of the proposals sought to be introduced in the Draft Taxation Laws Amendment Bill, 2013 ("DTLAB") was to impose a limit on the interest deduction claimed by a taxpayer (the "acquirer") on loan funding used to either:

acquire the assets of a target company or

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