{"id":6472,"date":"2026-04-30T11:07:57","date_gmt":"2026-04-30T09:07:57","guid":{"rendered":"https:\/\/dotnewsconnect.co.za\/fin\/?p=6472"},"modified":"2026-04-30T11:16:41","modified_gmt":"2026-04-30T09:16:41","slug":"death-and-capital-gains-taxes-dont-get-caught-out","status":"publish","type":"post","link":"https:\/\/dotnewsconnect.co.za\/fin\/2026\/death-and-capital-gains-taxes-dont-get-caught-out\/","title":{"rendered":"Death and (Capital Gains) Taxes: Don\u2019t Get Caught Out"},"content":{"rendered":"\n
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\u201cNothing in this world can be said to be certain except death and taxes.\u201d (Benjamin Franklin)<\/p>\n<\/blockquote>\n\n\n\n

You don’t see it \u2026 Until you do<\/h6>\n\n\n\n

For most South Africans, Capital Gains Tax (CGT) isn\u2019t something they dwell on much. It doesn’t change how much money you make each month, and it doesn\u2019t appear on the dreaded laundry list of monthly debit orders. But as your investments grow over time, so does CGT. And then, at certain times in life, it becomes very real. Death is one of those times.<\/p>\n\n\n\n

A quick reminder<\/h6>\n\n\n\n

South Africa started charging capital gains tax in 2001. CGT is different from income tax because it is based on how much your assets have grown in value. Your capital gain is the difference between how much you paid for an asset and how much it is now worth. For example, if you bought an asset for R1 million and it is now worth R2 million, your capital gain is R1 million.<\/p>\n\n\n\n

When that gain is realised or thought to be realised at death, part of it becomes taxable. Individuals in South Africa only pay tax on part of their gains (40%), and the effective rate depends on their marginal tax rate.<\/p>\n\n\n\n

What\u2019s the point?<\/h6>\n\n\n\n

CGT is based on a larger worldview that taxes should not be based solely on income but also on wealth gains. This helps governments raise revenue and reduce inequality by ensuring that gains from assets, not just salaries, are taxed. This is significant in South Africa.<\/p>\n\n\n\n

When you die, your assets are treated as if they were sold at market value, even if nothing is actually sold. This is called a “deemed disposal on death.” And it triggers Capital Gains Tax on the deceased’s estate.<\/p>\n\n\n\n

A very welcome change<\/h6>\n\n\n\n

SARS lets people exclude some CGT at death to lessen its impact. This has recently gone up from R300,000 to R440,000. At first glance, this may not seem like much, but all tax breaks are significant.<\/p>\n\n\n\n

There are two reasons asset values rise over time: real growth and inflation. It’s easy to understand this when the asset is real estate. A holiday home or investment property bought years ago may have doubled in value. But a meaningful portion of that increase is due to rising prices rather than real wealth creation.<\/p>\n\n\n\n

The higher R440,000 exclusion helps with:<\/p>\n\n\n\n