| (1) | [Section 23D(1) deleted by section 20(1)(a) of the Revenue Laws Amendment Act, 2007 (Act No. 35 of 2007)] |
| (2) | Where any depreciable asset which is let or licensed by a taxpayer to a lessee or licensee was held within a period of two years preceding the commencement of the lease or licence— |
| (a) | by the lessee or licensee, or by any sub-lessee or sub-license in relation to the asset; or |
| (b) | by a person who was at any time during that period a connected person in relation to the lessee, licensee, sub-lessee or sub-license, |
the cost or value of the depreciable asset for the purpose of this section and any deduction or allowance claimed by the taxpayer in respect of the asset shall not exceed the amount determined in accordance with subsection (2A).
[Section 23D(2) substituted by section 18 of the Taxation Laws Amendment Act, 2008 (Act No. 3 of 2008)]
| (2A) | The amount to be determined for purposes of subsection (2) is the sum of— |
| (a) | The cost of the asset to the most recent lessee, licensee, sub-lessee, sub-license or connected person contemplated in subsection (2) that previously held that asset, less the sum of— |
| (i) | all deductions which have been allowed to the lessee, licensee, sub-lessee, sub-licensee or connected person in respect of the asset; and |
| (ii) | all deductions that are deemed to have been allowed to the lessee, licensee, sub-lessee, sub-licensee or connected person in respect of the asset in terms of section 11(e)(ix), 12B(4B), 12C(4A), 12D(3A), 12DA(4), 12F(3A), 13(1A), 13bis(3A), 13ter(6A), 13quin(3) or 37B(4); |
| (b) | any amount contemplated in paragraph (n) of the definition of "gross income" in section 1 that is required to be included in the income of the lessee, licensee, sub-lessee, sub-licensee or connected person that arises as a result of the disposal of the asset; and |
| (c) | the applicable percentage in paragraph 10 of the Eighth Schedule, of the capital gain of the lessee, licensee, sublessee, sub-licensee, or connected person that arises as a result of the disposal. |
[Section 23D(2A)(c) substituted by section 44(1) of the Taxation Laws Amendment Act, 2012 (Act No. 22 of 2012) - deemed to have come into operation as from the commencement of years of assessment ending on or after on 1 January 2009]
| (3) | [Section 23D(3) deleted by section 34(d) of the Revenue Laws Amendment Act, 2007 (Act No. 35 of 2007)] |
