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Gross Income, image, Ordinary resident, image, image, image, image, image,…

- - - - John Bell
        Issue: Was there a change in the intended use of the
        asset? did the property become trading stock?
        Judgement: The court emphasised the principle that a
        taxpayer is entitled to realise his property to
        his best advantage. There was no factual
        evidence that indicated that the taxpayer had
        had a change in intention to use the property
        as trading stock.
        Principle: The mere decision to sell an asset does not change
        an intention. A capital asset may be realised at its
        best advantage. Waiting for market conditions to
        change was not an indication of a change in intention.
      - Natal Estates Ltd
        Issue: Was the subdivision a change of intention
        from capital to revenue?
        Judgement: The original intention of the taxpayer to hold
        the capital asset as an investment is an
        important, yet not a deciding factor. A change of
        intention was evidenced as the field of
        development and marketing on a grand scale
        was entered into (Scheme of profit making).
        Principle: A person may realise his capital asset to his best
        advantage yet must be careful not to “cross the
        Rubicon” and embark on a scheme of profit making.
        This indicates a change of intention and the proceeds
        being revenue in nature.
      - Nussbaum
        Issue: Does the large number of purchase and sale
        of shares during the three-year period
        constitute a scheme of profit making? Is there
        a dual/secondary intention?
        Judgement: The frequency of transactions indicates
        continuity (element in carrying on a business).
        Almost all the sales were profitable; the
        taxpayer studied his portfolio and was aware
        of the profit implications in selling. He was
        primarily an investor yet had a secondary
        purpose of profit making. Both are almost
        equally important.
        Principle: The secondary purpose could taint the primary
        purpose of a taxpayer, if a taxpayer’s actions
        become too frequent
- - - - Residence merely means that a person eats, sleeps,
        and works at a place with some degree of continuity
        or permanence.
        
        Cohen:
        Issue: Is the taxpayer ordinarily resident in South Africa while working overseas for two years
        Judgement: Physical absence is not decisive in determining
        if one is ordinarily resident. The taxpayer’s actions for the two years are not the sole test. “If, though a man may be resident in more than one country at a time, he can only be 'ordinarily resident' in one, it would be natural to interpret 'ordinary resident' by reference to the country of his most fixed or settled residence. His ordinary residence would be the country to which he would naturally and as a matter of course return from all his wanderings, as contrasted with other lands it might be called his usual or principal residence and it would be described more aptly than other countries as his real home.”
        Principle: A person is ordinary in the country to which he intends to return from all his wanderings. The country he is regarded as his real home
        
        Kuttel:
        Issue: Is the taxpayer ordinarily resident in SA?
        Judgement: Ordinarily resident is a narrower concept than
        resident. The place of ordinary residence was the place where the person was habitually and normally resident, apart from temporary or occasional absences of long or short duration. The taxpayer’s real home was seen to be in America.
        Principle: A person is ordinarily resident where the person’s principle residence is – where the person is habitually and normally resident.
        
        Two Cases:
    - - Will cease to be a resident if absent for 330 continuous days