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Capital Gains Tax and your investment

You may be looking to sell your investment and are worried about the Capital Gains Tax you will be liable for. We’d like to help you understand this process and have put together some important information for you to go through. 

What is Capital Gains Tax?

When you sell or withdraw an asset, whether it be a property, a share, ETF or unit trust, if there has been a profit/growth in the asset, you are liable to pay tax on it. You also need to let SARS know via your tax return that you have made a gain on the asset. 

The rate of tax that you will pay is based on your tax bracket in the year of selling the asset. If you have sold or withdrawn from more than one asset or investment, both will need to be added to your income tax liability. 

As an individual tax payer you have R40,000 per tax year that is exempt from Capital Gains Tax (CGT). So, if your gain/profit has been lower than this, you won’t have to pay CGT in that tax year.

Please follow this link for more info on the SARS website. 

EasyEquities and your tax

We are an online DIY platform and we have geared the platform in a way that ensures we remain as cost effective as possible. We have not structured our business to handle technical tax queries which is why we’ll always refer you to a tax expert should you have any queries on your tax. Our favorite is TaxTim, please follow this link to get assistance from them. 

You can access your statements online via the platform, which will show the profit you have made in your investment. This may not be a real reflection of the gain you have made on your investment, as you may have elected to reinvest your dividends for example.

The statement will show your unrealized capital gain for the period you have requested, and this can be used as a guide for tax purposes. The figures on your statement do not include the selling costs of the instrument you are in; this will lower the capital gain figure slightly. 

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