February 9, 2021

Capital gains tax – When does it come into play?

The distinction between amounts received of a capital nature as opposed to a revenue (or income) nature is essential for income tax purposes. Non-capital amounts received, such as from the disposal of trading stock, are subject to tax at a higher effective rate compared to capital profits. The primary intention with which an asset is acquired is generally conclusive as to the nature of the receipt arising from the realisation of a capital asset unless other factors intervene which show that it was sold in pursuance of a profit-making scheme. It is not uncommon though, that a person’s intention in […]