asset for share swap

On the face of it s42 is a magic way of moving assets into a trust with no or low tax, but there’s a hidden catch. Here’s how you might see it at first glance. We’ll take a commercial property as an example. You own a commercial property in your own name. Let’s say it cost you R2m and is now worth R6m. You form a new company and issue its shares to yourself in exchange for the property. That’s the asset for share swap and there are no taxes of any kind imposed. According to s42,…