Guides

Capital gains tax when you sell your house (2026/27)

Figures for the 2026/27 tax year. Prime rate checked 9 October 2026; tax tables and fees checked 30 September 2026. By AfroTech.

For most South Africans selling the home they live in, the answer is no. From the 2026/27 tax year, the first R 3 000 000 of gain on your primary residence is excluded, up from R 2 000 000. Second homes and rental properties are a different story.

Your own home

Buy a home for R 1 800 000, sell it years later for R 4 500 000, and pay R 200 000 in agent's commission: your gain is R 2 500 000. That's under the R 3 000 000 exclusion, so the capital gains tax is R 0.

Only very large gains are taxed. Selling for R 8 000 000 a home that cost R 3 000 000 gives a R 4 650 000 gain; after the exclusions, the tax is about R 253 786 for someone with R 600 000 other income.

A second home or rental property

There's no primary residence exclusion, only the R 50 000 annual exclusion. Selling a rental property for R 2 500 000 that cost R 1 200 000, with R 100 000 selling costs, gives a R 1 200 000 gain and about R 179 986 in tax for someone earning R 600 000 a year.

How the tax is worked out

1. Gain = selling price − (purchase price + buying costs + improvements) − selling costs.
2. Subtract the primary residence exclusion (your home only) and the R 50 000 annual exclusion.
3. Add 40% of what's left to your taxable income for the year, and pay tax at your normal rate.

The most anyone pays is 18% of the gain.

Keep your records

Your base cost includes the transfer duty and conveyancing fees you paid when buying, and the cost of improvements such as extensions, new kitchens and security systems, but not repairs and maintenance. Keep the invoices: they reduce your gain. If you let part of the home or ran a business from it, part of the gain may not qualify for the exclusion.

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