How CGT works in South Africa
When you sell an asset for more than you paid for it, the profit is a capital gain. SARS taxes a portion of that gain at your normal income tax rate. The result is an effective rate that varies with your income — never higher than 18% for individuals.
Order of operations: Gain → less primary residence exemption (if applicable) → less the R 50 000 annual exclusion → multiply by 40% inclusion → add to other taxable income → tax at marginal rate.
Key exemptions
- Primary residence: R 2 000 000 exemption per home.
- Annual exclusion: R 50 000 per year for individuals.
- Personal-use assets: e.g. your car, furniture, jewellery — fully excluded.
- Retirement funds: withdrawals are taxed under the retirement regime, not CGT.
Frequently asked questions
Related: PAYE Calculator · Transfer Duty