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Individuals- CGT 3rd Year (Exclusions -Primary residence exclusion …
Individuals- CGT 3rd Year
Annual Exclusion
-R40 000 for Individuals
Inclusion Rate
-40% for individuals
Kink Test for VDV
Pre-CGT Expenditure Records?
Yes
Historic Gain
P > (B+A)
TP Elects
VDV = MV, TAB, 20% x [P – A]
If MV is adopted as VDV and P</=MV
VDV = P - A
Historic Loss
P ≤ (B+A)
Has MV determined/published?
Yes
MV< B >=P?
Yes
VDV = Higher MV and [P-A]
No
VDV = lower MV and TAB
No
VDV=TAB
No
VDV = MV or 20% x [P-A]
Exclusions
-Primary residence exclusion
-Personal-use assets
-Lump sum benefits exclusion
-Long term assurance policies exclusions
-Compensation payments
-Gambling, games or competitions
Primary Residence
Residence
= Structure (incl. boat, caravan or mobile home used as place of residence), Appurtenance (eg pool, garage, tennis court)
Primary Residence
= A residence in which;
-NP holds an interest and
-In which that NP/spouse ordinarily resides as main residence & used mainly domestic purposes
Primary Res Exclusion
-Disregard any Cap Gain/Loss NOT EXCEEDING R2 000 000 on disposal
-If proceeds <= R2 000 000 the whole cap gain is ignored
-NP can only have one PR at a time
-Exclusion applies to a residence
Personal Use Assets
Asset owned by NP used mainly for purposes other than trade
Specific Exclusions (i.e not PU & Subject to CGT)
:
-Coin made from gold/platinum (eg. krugerrand)
-Immovable property
-Aircraft w/ empty mass exceeding 450kg
-Boat exceeding 10m in length
-FI
-Fiduciary/ usufructory interest
-Short Term insurance policies over non PU Asses
-Long Term insurance contracts
PUA Exclusion
-Disregard any cap gain/loss on disposal
Loss Limitation
Disregard any cap LOSS (But still take in cap gain) on disposal of:
-Aircraft w/ empty mass exceeding 450kg
-Boat >10m in length
-Fiduciary/usufruct interest
-timeshare
-lease of immovable property
Lump Sum Benefits Exclusion
-Disregard cap gains/lossess iro. disposal that result in him receiving lump sum benefit from FUNDS
Long Term Assurance Excl.
-Disregard cap gains/losses as long as they are not 2nd hand & not foreign
Compensation Pmts. Exclusion
Disregard any cap gain/loss upon receipt of compensation for:
-Personal injury
-illness or
-defamation
Gambling, games or comps. Excl.
-All cap LOSSES disregarded
-Cap GAINS only disregarded IF
1)NP, and
2)Gambling conducted & authorised by SA laws
Therefore:
-Foreign winnings subject to CGT
-All winnings of Co. Subject to CGT