The "profit" made on the sale of immovable property is taxable in the form of Capital Gains Tax (CGT).
In the event that the property
was owned prior to 2001, the starting value will be the value of the property in 2001 and tax will be paid on the increased value since
then less certain deductions such as transfer costs, capital improvements and estate agent's fees.
The "profit" is taxed in the hands of the Seller in the financial year that the profits were made.
For South African residents the first R2million profit on their primary residence is tax-free. For non SA residents, unless
a tax directive is issued by SARS, the conveyancers are obligated a percentage of the purchase price should the purchase price exceed R2million.
It is recommended that you seek professional advice from a tax practitioner or your accountant in this regard.
