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Can I deducted 2 years from my CGT.

Posted 25 February 2016 under Tax Questions



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Richarf says:
25 February 2016 at 9:19

We just sold a flat that we owned for 10 years. We lived in it for 2 years but we've been letting it for the last 5 years. Do I need to pay CGT of the full 10 years of can I deduct some amount for tee 2 years that we lived in it and it was our primary residence?

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TaxTimTaxTim says:
25 February 2016 at 14:13

Out of the 10 years, you must pro-rata the time used as a primary residence (2/10) versus time used as a rental property (8/10). You would then proportion the Capital Gain accordingly. You would always pay full Capital Gains tax for the portion of the gain relating to rental use (8/10), and then you would apply the primary residence exclusion of R2m to the balance (2/10).

Remember though that 1/3 of the Capital Gain is added to your income and taxed at your normal tax rate.

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