1

Pink Panther (a South African resident) is an elusive jewel thief. He stole loose diamonds to the value of R20 000 000 from De Beers. He fenced the stolen diamonds on 28 February 2022 on the black market and received bitcoins on 2 March 2022 in exchange.

Required

You have been appointed by SARS to argue whether the income generated from the sale of the stolen diamonds will constitute gross income and whether Pink Panther will be taxed on the income in the 2022 tax period. Refer to the applicable definitions and include a brief description, in your own words, of applicable case law (if any).

QUESTION 2

Adios (Pty) Limited has an assessed loss of R350 000 from the year ended 30 June 2020. During the 2022 tax year, the company earned a gross income of R580 000 and incurred deductible expenses of R310 000. One creditor, to whom the company owed R100 000, agreed to accept the lesser amount of R80 000 in full and final settlement.

Calculate Adios (Pty) Limited’s assessed loss to be carried forward to the 2023 tax year.