So if I'm not mistaken, when declaring taxable amounts I could declare the sale's profit of a high performing share as a capital gain even if it's been held for less than 3 years. Then it's up to SARS to investigate if they want to disprove my claim and apply a marginal tax instead. Is that how it works?
Tax
#61
Posted 22 August 2013 - 03:18 PM
#62
Posted 22 August 2013 - 12:38 PM
I have never been asked to provide trading history , so how does it then trigger SARS to query your reason for selling . It also works both ways so if you make a loss with a share you have had for less than 3 years then SARS will have to share that loss with you at your marginal rate which I'm sur ethey not to keen on
#63
Posted 22 August 2013 - 11:27 AM
Has anyone actually been challenged by SARS on the 3 year rule. Wonder if they even bother unless you are making millions
What do you mean?
Challenged by SARS for accounting a sale of equity held for more than three years as a capital gain? IIRC that's legislated, not something SARS can challenge.
If you mean SARS doing one thing or the other for a sale within three years, then I'm sure that comes up each year.
#64
Posted 22 August 2013 - 11:18 AM
Has anyone actually been challenged by SARS on the 3 year rule. Wonder if they even bother unless you are making millions
#65
Posted 22 August 2013 - 08:48 AM
Hi guys,
I've been looking into tax around stocks and I'm a little confused. There is captal gains tax and marginal tax. The former applies to investors, the latter apllies to traders. Nows there's a 3 year rule. If u hold onto a share for 3 yrs before selling you should qualify for capital gains tax which is much less severe. However there are exceptions. U can sell the share before 3 years and stil be considered an investor. This part confuses me. Can I sell my shares after six months and use that same money to buy a different set of stocks and still qualify for capital gains tax?
On a similar note, I've heard you should have 2 seperate accounts for investing and trading. Does this refer to bank acounts, or the actual trading platform account?
you don't have to have 2 accounts but its cleaner esp if you are very active in trading and investing.
with one account you simply need to justify each position on its merits
#66
Posted 22 August 2013 - 08:30 AM
After three years it's automatically CGT. Before three years it's entirely up to SARS to make a judgement. If you can convince them it's an investment action, not an income action, then you can get them to apply CGT.
#67
Posted 21 August 2013 - 11:24 PM
I've been looking into tax around stocks and I'm a little confused. There is captal gains tax and marginal tax. The former applies to investors, the latter apllies to traders. Nows there's a 3 year rule. If u hold onto a share for 3 yrs before selling you should qualify for capital gains tax which is much less severe. However there are exceptions. U can sell the share before 3 years and stil be considered an investor. This part confuses me. Can I sell my shares after six months and use that same money to buy a different set of stocks and still qualify for capital gains tax?
On a similar note, I've heard you should have 2 seperate accounts for investing and trading. Does this refer to bank acounts, or the actual trading platform account?
Edited by joker, 21 August 2013 - 11:29 PM.