What Is Capital Gain Tax In South Africa

What is Capital Gain Tax?

A capital gains tax is the tax on profits realized on the sale of a non-inventory asset.

What Is Capital Gain Tax In South Africa?

The inclusion rate (only 40% of the capital gain will be taxed if you’re an individual, and 80% if it’s a company or trust selling the property).

The tax rate. As of February 2023, the marginal tax rate is 18% for individuals, 21.6% for businesses, and 36% for other trusts.

How is Capital Gain Tax Calculated in South Africa?

Capital Gains Tax applies to all assets disposed of on or after 1 October 2001. Your capital gains tax will equal your capital gains x the 40% inclusion rate x your marginal tax rate (which increases according to your income).

What is the formula for calculating capital gains tax?

Subtract your basis (what you paid) from the realized amount (how much you sold it for) to determine the difference.

If you sold your assets for more than you paid, you have a capital gain. If you sold your assets for less than you paid, you have a capital loss.