In South Africa, a deemed disposal happens when you’re treated as if you sold an asset—even though you didn’t actually sell it. This is important for Capital Gains Tax (CGT), because it can trigger tax on gains you haven’t yet received in cash.
Here are some common examples:
Emigration: If you leave South Africa and cease your residency, you’re seen as having sold most of your worldwide assets at market value the day before you leave. Note, that South African immovable property (land and buildings) and South African retirement funds are excluded from this rule.
Donations: Giving something away (like property or shares) is treated as a sale at market value.
Death: When someone passes away, it's seen as if they sold their assets—though some transfers, like to a spouse, can be tax-free.
Changing how an asset is used: For example, turning your home into a business property can trigger a deemed disposal.
Why does this matter? Because SARS (the tax authority) wants to make sure capital gains are taxed, even if no money actually changes hands.
If you're moving abroad, donating assets, or planning your estate, it's wise to get tax advice—deemed disposals can have big tax effects.
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