FAQ: I bought LISTED shares in 1999 for R100 and sold them in 2013 for R70. Their market value on 1 October 2001 was R60. Am I liable for CGT on the R10 (R70 – R60) even though I made an actual loss of R30 (R70 – R100)?

The answer depends on which asset identification method you have adopted. First in, first out or specific identification If you adopted the first-in-first-out or specific identification method for identifying which shares you have disposed of, your valuation date value will be restated to R70 under paragraph 27(3)(a) of the Eighth Schedule. There will, therefore, be […]

FAQ: If, after 1 October 2001, an investor were to add monthly to units in a unit trust fund acquired before valuation date and then sell all the units how would the loss/gain be calculated?

Two features of the legislation reduce the record-keeping required of a monthly investor in a unit trust. The weighted average cost method is one of three asset identification methods for determining the base cost of identical assets such as unit trusts. The other methods permitted are specific identification and first in, first out (FIFO). In […]

FAQ: What if an asset was acquired before the valuation date?

For an asset acquired before the valuation date and disposed of afterwards, CGT will be payable only on the capital gain attributable to the period after the valuation date. In other words, any gain attributable to the pre-valuation date period is not subject to CGT. The gain attributable to the period of ownership of an […]

FAQ: What is base cost?

Base cost is the amount against which any proceeds upon disposal are compared in order to determine whether a capital gain or loss has been realised. For assets held on the valuation date (1 October 2001) that were acquired before that date  base cost is equal to the “valuation date value” of the asset plus […]