My mother passed away in March 2014. Her estate was finally wound up and shares transferred into my share account in March 2015. Assuming I sell these shares, how are the cost prices determined (for CGT)? Is it the price of the shares on the day of her death, or the day the shares were tranferred to me? Sadly, I have so far been unable to get an answer from the staff manning "contact us" on this site :(
If the shares were bought before 1/October 2001 then all U do is look up the share quote as that is the date that CGT was introduced. Read down and U will see it's mentioned there....For example AGL price upon that date was R99.88.
Hi Barry, thank you for replying. I only inherited the shares in March this year. The portfolio was managed by PSG, so I am sure a lot of buying and selling has been happening over the years. I have no idea when shares were bought, but as I did not own them then, cannot understand why historical values should apply if I sell them within days of acquiring (inheriting) them, thereby creating a capital gain on paper. PSG seems to think the cost price should be the value of the shares on the day my mother died (almost a year ago). To me it makes more sense that the cost price should be the value on the day that they were transferred to my portfolio. Joan
There are 2 CGT events 1. Date of death. The deceased is deemed to have disposed the shares on that date. The deceased will be liable for CGT 2. Date asset transferred from estate to you. The estate will have a CGT gain/loss computed on the difference between the share price on date of death and the date the estate transferred the shares to you In both events you will not be liable for CGT The only time you will be liable for CGT is when you dispose the shares.
Your answer is correct, as the Estate is still liable for tax on any income be it trading, interest, or of a capital nature from time of death to winding up of the deceased person's estate. In my case, with my brothers' consent I purchased my late mother's shares at the closing price on the day of her death, and the funds transferred into her estate account the following day.