PROPERTY OWNERS, YOU NEED A PROFFESIONAL PROPERTY VALUER.

WHY?

A registered professional valuer is an independent, objective, practitioner inside the property industry.

The valuer is an educated, experienced person with extensive knowledge of the valuation process and the determination of property values.

The valuation industry and the services offered are largely unknown by the general public.

DO I NEED A VALUER?

All property owners require or will require the services of a professional valuer; this includes residential, commercial, industrial, agricultural, limited rights in land and other specialized properties.

Investment in the largest of assets forces property owners to also invest in knowledge.

WHAT SERVICES DOES A VALUER RENDER?

A property valuer is equipped to determine value of fixed property, execute feasibility studies and provide expert advice on property related matters.

The purposes of a valuer include:

• Purchase and sale requirements
• Reporting to shareholders
• Cost accounting
• Mergers/takeovers
• Rent reviews
• Insurance purposes
• Town establishments
• Financing purposes
• General disputes and advice
• Local and provincial government issues; Capital Gains Tax
• Insolvency estates
• Deceased estates
• Estate duty
• Divorced cases
• Expropriations
• Arbitrations/litigations
• Assessment rates (municipal value)
• Be assured that your valuation requirements are divergent.

CAPITAL GAINS TAX

The effective date of Capital Gains Tax is 1 October 2001.

All individuals (although not registered for income tax) are liable for Capital Gains Tax. Trusts, closed corporations, companies and estates are all subject to CGT.

Capital gain is payable at a rate of 25 % for individuals and 50 % for a trust, closed corporation or company. Where as 25 % of the gain is added to the individual’s taxable income and 50 % to that of a trust, closed corporation or company.

An annual discount of R 10 000 for capital gain/loss are permitted for individuals and R 50 000 in the case of a deceased estate. The trust, closed corporation and company owned properties do not qualify for discount. Capital loss can only be accounted for in the following book year for other gains acquired.

Assets/property acquired before 1 October 2001 has three methods to determine a base cost as at 1 October 2001.

1. Market Value (valuation)

2. Time apportioned base cost (original purchase price plus expenses before 1 October 2001)

3. 20 % formula (proceeds)

Taking the three methods into account the market value method is favoured. (The valuation is a tax deductible item)

When a valuation (market value report) is attained the tax payer will still have the benefit to choose which method will benefit him/her more at date of disposal.

WHICH PROPERTIES ARE SUBJECT TO CGT?

• All properties (excluding certain primary residences)

• Primary residences owned by CC’s, companies and trusts.

• Primary residences with a capital gain of more than R 1 million when disposed of.

• All agricultural properties larger than 2 hectare (first 2 ha dealt as freed primary residence)

• All commercial and industrial properties.

• Listed and unlisted shares (includes shares in properties)

The minister of finance has extended the period for obtaining CGT valuations of all assets acquired before 1 October 2001 until 30 September 2004. A taxpayer who fails to obtain a valuation within the prescribed period will not be able to adopt the market value method to determine the base cost of an asset.

YOU ARE URGENTLY REMINDED TO CONSIDER YOU’RE CHOICES.