Section 12J of the Income Tax Act was created specifically to encourage taxpayers to invest in small and medium sized enterprises in the Republic of South Africa.
Taxpayers who invest in a registered Venture Capital Company (VCC) are entitled to a 100% tax deduction on monies invested, thereby achieving an immediate return of up to 41% for individuals and trusts, and 28% for companies (being the reduction in marginal taxes payable) on their investment.
Anuva Investments, one of South Africa’s first Section 12J Venture Capital Companies, has announced its maiden results for the February 2016 financial year. The VCC has reported earnings of R13.7million and paid a dividend of 28% to the initial investors.
The Anuva VCC strategy is to invest in promising, well-managed small-to-medium companies, securely established but under-capitalised.