Joseph Buthelezi, aged 45, runs a successful small garden service and landscaping business as a sole trader. His turnover is greater than R1 million per annum. During the 2019 year of assessment, Joseph made a number of disposals of both business and personal assets. Details of these disposals are as follows: (i) Joseph sold a ride-on lawn mower which he had used at his larger corporate clients. The mower was acquired at a cost of R50,000 in the 2016 year of assessment and was fully written off for tax purposes. On 22 September 2018, Joseph sold the mower back to the seller to upgrade to the latest model. The trade-in value was given as R35,000. The new mower cost R65,000. (ii) Joseph sold a plot of land on which a small building stood. He had originally acquired the land to house equipment for a planned expansion of his sole trader business into a new area. However, Joseph's brother wanted to start his own landscaping service in the same area. On 31 October 2018, Joseph sold the land and building, valued at R1,200,000, to his brother for R900,000. This resulted in a donations tax payment of R40,000. Joseph had originally purchased the property for R1,000,000 in the 2014 year of assessment. (iii) Joseph is an avid fisherman and owned an 11-metre fishing boat for use in his free time. He acquired it in the 2009 year of assessment for R350,000 and sold it on 8 December 2018 for R100,000. (iv) Joseph sold some shares he owned in a prominent company which had been accused of corruption and was later declared insolvent. Joseph had acquired shares in this company over several years and his shares have a weighted average cost of R170,000. He sold the shares for R5,000 on 15 January 2019. Joseph has an assessed capital loss brought forward of R50,000.

Required:

Calculate Joseph's taxable capital gain/assessed capital loss carried forward for the 2019 year of assessment.

Note: You should indicate by the use of zero (0) any amounts which are not taxable or not deductible.

Full capital gains tax calculations must be shown for all disposals.

Answer rating: 100% (QA)

Lets break down the capital gains tax calculations for each disposal i Rideon Lawn Mower Proceeds R3... View the full answer