Understanding Capital Gains Tax (CGT) in South Africa: A Comprehensive Guide
By TickBirds Certified Business Accountants
Capital Gains Tax (CGT) is an integral component of South Africa’s taxation system, affecting the financial outcomes of disposing of assets. At its core, CGT is the tax levied on the profit – or “capital gain” – realized when you sell, donate, or otherwise dispose of an asset. This tax is calculated as the difference between the asset’s base cost (what you paid or its market value on acquisition) and the proceeds received at disposal. The rules governing CGT are set out in the Income Tax Act No. 58 of 1962 (as amended) and administered by the South African Revenue Service (SARS).
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