13.7 CONCLUSION
Regulation 31 clearly was an afterthought with SARS getting involved. I don’t see why there was this need for SARS to get involved in the companies act as they could quite as easily put this legislation into the income tax acts. This procedure was probably intended for larger companies but clearly affects all small companies unnecessarily creating a huge amount of additional company secretarial labour.
One also needs to look at all the tax consequences for the transactions above and the future tax situation of the shares converted or subdivided or share premium paid back.