M & A Debt vs Equity
Presenters : Carmen Westermeyer CA(SA) , Caryn Maitland CA(SA)
Overview
This webinar will explore the critical decision-making process involved in choosing between debt and equity financing. Attendees will gain a comprehensive understanding of the benefits, risks, and financial implications of each option, including how they affect a company’s capital structure and long-term financial health. The session will delve into factors influencing the choice between debt and equity, such as cost of capital, control considerations, tax impacts, and the overall strategic goals of the business. Participants will leave with actionable insights on how to determine the optimal financing mix to support business growth while managing financial risk.
Learning Objectives
- Learn how tax authorities evaluate the actual legal form of financial instruments, regardless of their intended use or classification.
- Gain insights into the anti-avoidance treatment and its impact, ensuring that the underlying nature of financial instruments remains unchanged.
- Understand how accounting disclosures do not alter the fundamental legal nature of financial instruments.
- Obtain knowledge on how shares are regulated by the Companies Act and the implications for equity financing.
- Learn how debt instruments are governed by common law and the National Credit Act, and the legal considerations that affect debt financing decisions.
Content
- For the Company
- Contributed Tax Capital
- Considerations
- Distributions
- Dividends Withholding
- Tax
- Section 8E/8EA
- Donations Tax on issue?
- Maybe s7C?
- For the holder
- Section 8A, 8B or 8C
- Capital Gains Tax/Trading
- Stock considerations
- Section 22B/para 43A
- Dividends Withholding
- Tax
- Para 39 limitations
- Para 19 limitations
