CGT relief on a small-business asset using the R1.8m lifetime exclusion, age 55 and over.
CGT on the gain
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Excluded gain
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Included in income
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Exclusion remaining
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The relief that rewards a lifetime of building
South Africa has no separate capital gains tax. Instead, when you sell an asset for more than it cost you, a slice of that gain is added to your taxable income and taxed at your normal rate. For individuals the slice is set by a 40 percent inclusion rate, which is the figure this calculator uses. The small-business asset relief sits on top of that ordinary CGT machinery and is one of the few genuinely generous breaks in the system: it lets someone who has spent years building a business walk away with a chunk of the gain entirely free of tax when they finally sell up.
The relief is a lifetime allowance, not an annual one. This tool models it at R1.8 million, applied before the ordinary R40,000 annual exclusion that every taxpayer gets. So the order of events matters. First the lifetime exclusion knocks down the gain, then the annual exclusion shaves off a little more, and only what survives both is run through the 40 percent inclusion and taxed at your marginal rate. These are the figures the calculator applies for the 2025/26 year, and you should confirm the current numbers with SARS, since the lifetime cap and inclusion rate are exactly the kind of thing the National Treasury revisits.
Where age 55 draws the line
The relief is not open to everyone. You must be a natural person aged 55 or older at the time of disposal, or be forced to sell because of ill health or another qualifying reason. That is why this calculator switches the relief off entirely when you select an age under 55: the exclusion remaining drops to zero and the full gain, less only the annual exclusion, becomes taxable. The age gate catches people who sell a year or two early and forfeit a benefit worth hundreds of thousands of rand. If you are 53 and contemplating a sale, the arithmetic of waiting can be compelling.
Selling for a R2.5 million gain at 55
Take a gain of R2.5 million on the business assets, no prior exclusion used, R400,000 of other taxable income, and an owner aged 55. The full R1.8 million lifetime exclusion applies, then the R40,000 annual exclusion. That leaves R660,000, of which 40 percent, or R264,000, is included in income. Because the owner already sits in the 31 percent band, the extra R264,000 pushes into higher brackets, so the marginal tax on it works out to R89,400 using the rates this calculator applies.
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The chart shows how little of that R2.5 million gain ever reaches the tax net. Almost three-quarters is wiped out by the lifetime exclusion alone.
The R10 million asset-value test
One condition this simple calculator cannot check for you is the size of the business. The relief only applies where the market value of all the active business assets is R10 million or less, and there are further rules on how long you have held the interest and whether you were substantially involved in running it. If the business is larger than that ceiling, the lifetime exclusion falls away and you are back to the ordinary CGT calculation. A common mistake is to assume the relief is automatic on any business sale; it is narrow by design and aimed at genuinely small operations.
A practical tip: track how much of the R1.8 million you have already used across earlier disposals. The exclusion is cumulative over your lifetime, so if you sold a small business five years ago and claimed R600,000 of relief, only R1.2 million remains. Enter that prior figure in the calculator and the remaining headroom updates, which matters most for serial founders selling a second or third venture.
Can a company use this small-business CGT relief?
No. This exclusion is reserved for natural persons. A company that sells a business asset includes 80 percent of the gain in its income, taxed at the company rate, with no equivalent lifetime exclusion. If you trade through a company, the relief only ever reaches you on the gain from selling your shares, and only if those shares qualify in your own hands.
Does the relief cover the gain on selling my business premises?
It can, if the property is an active business asset used mainly in carrying on the business, rather than passive investment property let to tenants. The distinction turns on use, so a workshop you operate from is treated differently to a building you simply rent out. SARS looks at substance here, and the wider asset-value test still has to be met.