Capital Gains Tax: What You Need to Know!

ARE YOU NOT SURE HOW CAPITAL GAINS TAX WORKS? THEN WATCH THIS!!!!

In this video I discuss the basics about Capital Gains Tax. As mentioned its not a very technical video but I rather want to focus on you understanding the basics about Capital Gains Tax.

Here are the notes
Not a different tax, but how much of profit on sale of asset will be taxable
Certain exclusions apply
Introduced 1 October 2001
Capital vs Revenue
Intention when acquiring asset
Period of time held & intervening factors
Guide on website
Events that trigger a disposal
donation, exchange, loss, vesting, death, emigration

Basic principle

Selling price – base cost = capital gain / loss

Base cost = purchase price plus qualifying expenses
Losses carried forward

Inclusion rates
Individuals – 40%
Companies – 80%

Effective rates
Individuals – max 18% (45% x 40%)
Companies – max 22.4% (28% x 80%)
Examples to follow

The following are some of the specific exclusions:
R40 000 basic exclusion
R300 000 in year of death
R2 million gain or loss on the disposal of a primary residence
Most personal use assets
Retirement benefits
Payments in respect of original long-term insurance policies
small business exclusion of capital gains for individuals (limited)

Assets on which capital gains tax are payable
Land and buildings
Shares - Bitcoin
Certain personal use assets (planes, boats, jewellery,coins, artwork)
Contractual rights
Goodwill
Trade marks
Loans