Why 12J?

SilverLeaf Investments Pty Ltd in association with Grovest have developed an attractive structure for individuals, trusts or companies looking to invest in Cannabis related projects in South Africa. The structure makes use of incentives allowing a tax deduction of 28% for companies and up to 45% for individuals and trusts by taking advantage of the tax deductions allowed by Section 12J of the Income Tax Act.

SECTION 12J OF THE INCOME TAX ACT

  • The tax incentive was introduced by Treasury to promote investments in the South African economy and is formed in line with Section 12J of the Income Tax Act.
  • In order for South African taxpayers to claim the tax deduction, the South African taxpayers must structure their investments through a Section 12J Venture Capital Company (Section 12J VCC).
  • The tax deduction is available to any South African tacpayer (individual or entity) who structures qualifying investments through a Section 12J VCC.
  • The full amount invested into the Section 12J VCC is 100% deductible from an investor’s taxable income in the year in which the investment is made.