Example – primary residence exclusion

An individual’s primary residence was valued at R1 million on 1 October 2001. The residence was sold after the valuation date for R3,5 million.

    R
Proceeds   3 500 000
Valuation date value   1 000 000
Valuation fee   5 000
Swimming pool added after valuation date   45 000
  R R
Proceeds   3 500 000
Less: Base cost    
Valuation date value (1 000 000)  
Valuation fee (5 000)  
Improvements (45 000) (1 050 000)
Gain 2 450 000  
Less: Primary residence exclusion (2 000 000)  
Capital gain   450 000

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