MISSING A KEY POINT
All the talk around the budget speech by Minister Pravin Gordhan is that he missed an important point. He did not increase the capital gains exclusion or the interest exclusion, the amount that is tax-free before either capital gains or interest received is taxed. Essentially, this is tax by stealth, by not increasing the levels (and the CGT [capital gains tax] component is seldom increased) we essentially get hit with tax quicker as the R30 000 CGT exclusion doesn’t go as far as it did a year ago. That said, this really is a 1% issue as the vast majority of South Africans never incur any capital gain, never mind more than R30 000 worth of capital gain. SARS also released a new Tax Guide for Share Owners that you will f ind on their website and it is a must read for both you and your accountant. *The writer owns shares in Old Mutual.