Page 60 - P6 Slide - Taxation - Lecture Day 1

Solution - Standard TAB formula (par

30(1))

= (R100) + ((R700 – R100) × 10/30) = R300

The TAB cost is, therefore, R300 and the capital

gain on the disposal, using the TAB cost, will be

R400 (R700 – R300).

Test: Two-thirds of the profit relates to the post-

CGT period, ieR600 × 20/30 = R400.