atrick Smith On 18 December 2007 Patrick Smith purchased a residence for R1 500 000. He used it solely as his primary residence. On 2 February 2016 he sold this residence for R2 750 000 so as to purchase another primary residence. Patrick pays normal tax at the maximum marginal tax rate of 40%. He had no other capital gains or losses in the 2016 year of assessment.
atrick Smith On 18 December 2007 Patrick Smith purchased a residence for R1 500 000. He used it solely as his primary residence. On 2 February 2016 he sold this residence for R2 750 000 so as to purchase another primary residence. Patrick pays normal tax at the maximum marginal tax rate of 40%. He had no other capital gains or losses in the 2016 year of assessment.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Patrick Smith On 18 December 2007 Patrick Smith purchased a residence for R1 500 000. He used it solely as his primary residence. On 2 February 2016 he sold this residence for R2 750 000 so as to purchase another primary residence. Patrick pays normal tax at the maximum marginal tax rate of 40%. He had no other
Required: Determine Patrick’s additional normal tax liability that arises as a result of the capital gain he realised.
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