Income Tax Act, 1962 (Act No. 58 of 1962) Chapter III : General Provisions Part IA : Advance Pricing Agreements 76A. Definitions

 

In this Part, unless the context otherwise indicates—

 

‘‘advance pricing agreement’’

means—

 

‘‘advance pricing agreement application’’

means an application by a person to the Commissioner under section 76F(1) to enter into an advance pricing agreement;

 

‘‘affected transaction’’

means an affected transaction, as defined in section 31, excluding paragraph (b) of the definition;

 

‘‘affected party’’

means a person that is a party to an affected transaction;

 

‘‘agreement for the avoidance of double taxation’’

means an agreement under section 108 that contains Articles that are the same as, or similar to, Article 9(2) and Article 25(3), as amended from time to time, of the Model Tax Convention on Income and on Capital of the Organisation for Economic Co-operation and Development;

 

‘‘applicant’’

means a person who submits an advance pricing agreement application to SARS;

 

‘‘arm’s length allocation’’

means an allocation of the profit in an affected transaction that would have been the allocation of the profit if the affected parties had been independent persons dealing at arm’s length with each other;

 

‘‘arm’s length transfer price’’

means a transfer price in an affected transaction that would have been the transfer price if the affected parties had been independent persons dealing at arm’s length with each other;

 

‘‘competent authority’’

is an official in a country who is authorised by the government of the country to administer an agreement for the avoidance of double taxation that the Republic is a party to, and includes a person duly delegated by that official to perform the role;

 

‘‘country of residence’’

is the country in which a person is considered to be a resident, after the application of an agreement for the avoidance of double taxation;

 

‘‘DTA advance pricing agreement’’

means an agreement between an applicant and the competent authority of the Republic, in consultation with the competent authority of another country, which has an agreement for the avoidance of double taxation with the Republic, regarding the application of section 31 to an affected transaction in which the applicant is an affected party;

 

‘‘transfer price’’

means the price at which persons trade a service, tangible property or intangible property with each other across international borders;

 

‘‘transfer pricing method’’

means a transfer pricing method referred to in the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, as amended from time to time;

 

‘‘unilateral advance pricing agreement’’

means an agreement between an applicant and the Commissioner regarding the application of section 31 to an affected transaction in which the applicant is an affected party.

 

[Section 76A of Part 1A of Chapter III inserted by section 10 of  the Tax Administration Laws Amendment Act, 2023, GG49947, dated 22 December 2023]