Property sale issue
By Marc Sevitz · Updated
I'm selling a property of mine - it's my primary residence. The sale agreement will have the buyer settle the amount with me in monthly installments. Will this cause a problem with my tax return in terms of capital gains etc? Or would the end result be the same as if the buyer had paid me a lump sum?
You need to indicate the total proceeds per the sale agreement on your tax return (it doesn't matter how it is settled). The capital gain will be calculated on the total amount due to you regardless of when you receive the cash.
Thanks very much. Am I right in assuming that since the capital gain is less than R2 million and is for my primary residence that no tax would be owed to SARS?
Thanks very much. Am I right in assuming that since the capital gain is less than R2 million and is for my primary residence that no tax would be owed to SARS?
Yes, that is correct.
You should still disclose the details in you tax return though.
You should still disclose the details in you tax return though.
Thanks very much - I'll definitely disclose the details.
Just one more question:
If the payment terms are 3 years, and the property will transfer only after the payment is settled in full (end of the 3rd year), when do I need to declare the sale? In the tax year of the sale agreement, or in the tax year of the property transfer?
Just one more question:
If the payment terms are 3 years, and the property will transfer only after the payment is settled in full (end of the 3rd year), when do I need to declare the sale? In the tax year of the sale agreement, or in the tax year of the property transfer?
If the purchaser defaults on the payment terms, presumably the sale won't go through - is this correct?
That's correct.
You would declare the sale in your tax return in the year the property is transferred.