[Section 23H(1)(a) substituted by section 35(1) of the Taxation Laws Amendment Act, 2014 (Act No. 43 of 2014)] - deemed to have come into operation on 1 October 2012]
| (i) | goods or services, all of which will not be supplied or rendered to such person, during such year of assessment; or |
| (ii) | any other benefit, the period to which the expenditure relates extends beyond such year of assessment; |
[Section 23H(1)(b) substituted by section 34(1)(a) of the Second Revenue Laws Amendment Act, 2001 (Act No. 60 of 2001)]
the amount of the expenditure in respect of which a deduction shall be allowable in terms of such section in the said year and any subsequent year of assessment, shall be limited to, in the case of expenditure incurred in respect of—
| (i) | goods to be supplied, so much of the expenditure as relates to the goods actually supplied to such person in such year of assessment; or |
| (ii) | services to be rendered, an amount which bears to the total amount of such expenditure the same ratio as the number of months in such year during which such services are rendered bears to the total number of months during which such services will be rendered or, where the period during which such services will be rendered is not determinable, such period during which the services are likely to be rendered; or |
| (iii) | any other benefit to which such expenditure relates, an amount which bears to the total amount of such expenditure the same ratio as the number of months in such year during which such person will enjoy such benefit bears to the total number of months during which such person will enjoy such benefit or where the period of such benefit is not determinable; such period over which the benefit is likely to be enjoyed: |
Provided that the provisions of this section shall not apply—
| (aa) | where all the goods or services are to be supplied or rendered within six months after the end of the year of assessment during which the expenditure was incurred, or such person will have the full enjoyment of such benefit in respect of which the expenditure was incurred within such period, unless the expenditure is allowable as a deduction in terms of section 11D(2); or |
[Section 23H(1)(aa) of the proviso substituted by section 37 of the Taxation Laws Amendment Act, 2017 (Act No. 17 of 2017)]
| (bb) | where the aggregate of all amounts of expenditure incurred by such person, which would otherwise be limited by this section, does not exceed R100 000; or |
| (cc) | to any expenditure to which the provisions of section 24K or 24L apply; or |
| (dd) | to any expenditure actually paid in respect of any unconditional liability to pay an amount imposed by legislation. |
| (2) | If in any case the apportionment of the expenditure in accordance with subsection (1) does not reasonably represent a fair apportionment of such expenditure in respect of the goods, services or benefits to which it relates, such apportionment must be made in such other manner as is fair and reasonable. |
[Section 23H(2) substituted by section 38 of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (3) | Notwithstanding the provisions of subsections (1) and (2), where it is during any year of assessment shown by any person that— |
| (a) | the goods or services in respect of which the expenditure is incurred will never be received by or be rendered to such person; or |
| (b) | such person will never enjoy such other benefit in respect of which any expenditure is incurred, |
such expenditure shall be allowed in such year, to the extent that such expenditure has been actually paid by such person.
| (4) | [Section 23H(4) deleted by the Tax Administration Act, 2011 (Act No. 28 of 2011)] |
