On 01 November 2018, Sarah Wrangler sold the primary residence that she and Joe had lived in for the amount of R3 750 000. Sarah was the sole owner of the property and had purchased it on 01 October 2009 for the amount of R1 900 000, Sarah improved the property at a cost of R300 000 His employer had sent Joe overseas and Sarah and the children went with him. They were overseas from 1 December 2013 to 1 January 2018. Sarah had remained in the house (after their return and Joe's subsequence death) until the date of sale. Whist Joe, Sarah, and the children were overseas, they remained mainly residents in South Africa for tax purposes. They did during their absence; contemplate emigrating to an overseas country. In this regard, they put the house on the market for 8 months, starting 01 April 2017. Eventually, they decided that they would ultimately like to return to South Africa and took the house off the market (i.e. did not sell) Throughout their time overseas, the house was rented out. No deductions were claimed against the rental income.

Required: Calculate and discuss the capital gain effects (after any specific exclusions) for Sarah on the sale of the house. Assume that current tax rates apply for the foreseeable future.

Answer rating: 100% (QA)

The Capital Gain effect for Sarah on the sale of the house Particulars Amount in R Sale Value of ... View the full answer