If you do, then did you know that from 1 October 2001, you may be liable to pay capital gains tax (CGT) on any profits that you make from selling these assets?
However, you are only taxed on a PORTION of the ACTUAL GAIN that is made, and not on the entire value of the gain. If you make a loss on the sale, then you won't have to pay any CGT.
A capital gain is the profit that you make when you sell an asset not excluded from CGT. The gain is the difference between the price that you paid for the asset (also known as the base cost) and, the amount that you sold it for. You are only taxed on the gain or growth that took place after 1 October 2001.
When calculating your CGT liability, all costs linked to buying the asset, such as legal fees, agent's commission, and advertising costs, are included into the value of your base cost.
Furthermore, the first R 10 000 capital gain for each tax year does not count, so if your capital gain in one year is R 15 000, then you are only liable for CGT on a portion of the R5000, which is taxed according to your personal tax bracket.
If your primary residence is owned in the name of an individual, ie John Smith, you will not have to pay CGT if you make a profit of less than Rl million when you sell the house.
It is your responsibility to keep all records relating to the cost of the your asset, so that you can calculate and prove your base cost. For example, . if you build a pool on your primary residence and it costs you R 20 000, you can add this amount to your base cost in calculating the profit you make on the house when you sell it. You therefore need to keep proper records concerning your assets.