13 July 2018
Tax & Exchange
Section 31 of the Income Tax Act, No 58 of 1962 (Act) contains South Africa’s transfer pricing provisions which constitutes one of the most contentious areas of tax law not only in South Africa, but around the world. Historically, there has been no judicial precedent in South Africa regarding the application of s31 of the Act and in particular the important “arm’s length” principle. However, in Crookes Brothers Ltd v Commissioner for the South African Revenue Service  ZAGPHC 311 (judgment delivered 8 May 2018) (Crookes Bros) the High Court handed down findings regarding the application of certain provisions contemplated in s31 of the Act.