It might seem by reading the press that the section 12J tax benefit exists primarily to fund hotels. They are attractive to conservative investors with a limited risk appetite, since on top of a full tax deduction for the investment hotel operators are often prepared to give a guaranteed income yield of about 7%.
But it is also possible to invest in much more high-octane venture capital projects. If you have R1m to spare, and enough taxable income to get a R450,000 rebate from the SA Revenue Service, you could consider investing in KNF Ventures. The targeted internal rate of return is 40%. As section 12J requires money to be tied up for at least five years it lends itself to higher risk investments.