Kathy Thersby
The latest draft legislation on capital gains tax (CGT) was released last week, and the public have until March 12 to comment. The full draft legislation can be found at www.sars.gov.za under CGT.
These are some of the most important changes to the first draft:
l October 1 is the implementation date.
l If your home is registered in the name of a trust, you’ll be relieved to hear that you, like those whose homes are in close corporations and trusts, can transfer ownership of your primary residence to your personal capacity, and thereby enjoy concessions that apply to first homes.
l When you retire, any big capital gain you make that year won’t affect your average rate, and therefore the rate of tax you’ll pay on the taxable portion of your lump sum from a pension, provident or retirement annuity fund.
l When you die, you will be deemed to have realised your assets, but the first R50 000 will be excluded from CGT.
l As announced in the budget, estate duty will be reduced to 20% and heirs of heirs of indebted estates can apply for a three-year delay in paying the estate duty, although interest will still be payable.
l Life insurers will be allowed to write off more expenses against CGT.