Answered: A taxpayer (65 years old)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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D1.

A taxpayer (65 years old) sold a holiday home in the previous year of assessment. The taxpayer does not buy and sell houses regularly. The base cost of the house is R350 000. In terms of the sale agreement the taxpayer received R600 000 on the date of the sale in the previous year of assessment. The sales agreement stipulates that the taxpayer will receive 10% of the net profit generated from the rental of the house in the current year of assessment as the balance of the selling price. On 1 July of the current year of assessment the taxpayer received R50 000 representing the 10% of the net profit. Calculate the taxpayer's taxable capital gain or assessed capital loss for the current year of assessment.

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