What assumptions does the Guide make, when calculating CGT?
In arriving at our effective capital gains tax numbers, we make the following assumptions: • The property is directly and jointly owned by husband and wife; • They have owned it for 10 years; • It is their only source of capital gains in the country • It has appreciated in value by 100% over the 10 years to sale • The property was worth US$250,000 or €250,000 at purchase. • It is not their sole or principal residence. These assumptions are critical. In many countries a holding period of less than 5 years results in capital gains being taxable. But a longer holding period often results in no capital gains tax being payable. Note: We do not count taxes as capital gains taxes, if they are actually merely transaction taxes. For instance, the Philippines imposes a 6% ’Capital Gains Tax’ on the total purchase price or zonal value, whichever is higher. Despite its name, this is not really a tax on the gain, but a tax on the transaction value. Conversely in some countries there are some taxes
