Disclose primary residence sale on SARS tax return?

[Kodplessis]

Hi all,

 

A general question in closing up affairs (including tax) in South Africa. We have sold our house in SA, but the 'capital gain' was under the threshold to pay any capital gains. My question is whether we need to disclose the sale of the house in our annual tax return to SARS or just leave it out as it falls under the threshold?

 

Thanks

[Hugo2]

Hi

 

tax rules in SA: disclose all proceeds even tax Free inheritance. When it comes to unilateral SA exemptions or treaty benefits you are to fully disclose and claim the benefits.

 

Did I understand correctly you claim tax exemption is the gain is below the R2m primary residence exemption, yet you are living in Oz and you sold a primary residence?

 

Hardly possible unless it stood empty and was in the market for the entire period you were tax non-resident. Then event there is certain exclusion and reason why you may not be able to claim the full or even part of the R2m exemption 

 

If it was indeed your primary residence and you claim R2m full exemption, the sale of the house will impact your tax treaty tie-breaker outcome in that you now tax emigrate from SA and need to report for CGT the gains on all worldwide assets, including the Oz assets

Edited May 1, 2018 by Hugo2

[Kodplessis]

Hi Hugo,

 

Thanks for your feedback - I appreciate it. A bit more background around this.

 

We moved back to Australia at end of Aug 2016 to start work and our house in South Africa stood empty and the money for the sale was eventually received in Apr 2017 (a number of failed offers due to financing issues on a number of buyers), so I understand it will fall under this year's tax return (1 Mar 17 to 28 Feb18). The sale contract that went through was signed on 24 Oct 16. 

 

We have now bought a house in Australia and plan on living here. The amount we sold if for (less agents commission and repairs/renovations) amounts to about R300,000 more than the buy price. So hence I was wondering whether we should disclose this in out tax returns as this was our primary residence. 

 

Except for two small RA's, I have a bank account that generates a bit of interest, but not a lot.

 

Hence I was wondering if we (my wife and I) need to complete details of our house sale in our returns this year. We are not planning to financially emigrate just yet and do declare our Aus income in our SARS returns. Once we have finalised this year's return we would like to get the financial emigration process going as we do not see ourselves are tax residents in SA anymore.

 

Regards,

Kobus