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Never mind. Found out for myself.

For an individual investor like us.

If you buy 100 Microsoft shares for $1 each and sell them 3 years later at $2 then your gain is $100.00.
Your "buy" and "sell" must be calculated in $ terms and then the FX rate at the "sell" date must be used to convert it to the zar gain.

For companies and trusts.

If they buy 100 Microsoft shares for $1 each then the base cost must be converted to zar on the date of the purchase.
When they sell they must convert the $ to zar again. The zar difference will be their gain.

So it seems that the appreciation or depreciation of the currency will only affect companies and trusts.
This may be a huge knock for some if I read it correct.

 

https://www.moneyweb.co.za/investing/offshore-investing/the-tax-implications-of-emigrating/
Question:
Will capital gains on my offshore investments, denominated in US dollars, be calculated on (a) the pure capital gain in dollar
terms only multiplied by the current exchange rate or (b) the pure capital gain plus any exchange rate depreciation since the
investment was made?

Answer:
On the question of your shares, while the rules that apply to the calculation of capital gains tax on the disposal of local currency
assets are relatively well understood, they are less so when it comes to the disposal of foreign currency assets. Such a disposal is
basically subject to two rules:

Firstly, in the case of a natural person or non-trading trust disposing of an asset in a foreign currency after having acquired that
asset in the same currency, the capital gain or loss will be determined in the relevant foreign currency, followed by a conversion
to rand.

Example 1 (natural person or non-trading trust):

Base cost: 100 Microsoft shares purchased at $1 = $100

Proceeds/deemed disposal (ceasing to be a resident is treated as a deemed disposal): 100 Microsoft shares at current market price
of $2 per share = $200.

The gain is therefore $100. This will be converted to rand at either the spot or an average exchange rate, which will equate to
the rand gain or loss.

However, in all other instances the local currency is to be used to translate both the proceeds and the base cost. This applies
to disposals by a company or trust carrying on a trade. It also applies where a natural person or non-trading trust disposes of
an asset in a foreign currency, where the currency of expenditure and currency of proceeds are not the same.

Therefore the base cost as well as the proceeds will have to be converted to rand and the difference will equate to the capital
gain or loss. The exchange rate fluctuations from the date of acquisition to the date of disposal will therefore be taken into
account.

Example 2 (company or trust carrying on a trade):

Base cost: 100 Microsoft shares purchased at $1 = $100. This will be converted to rand at either the spot or the average exchange
rate, which will equate to a rand base cost.

Proceeds/Deemed disposal (ceasing to be a resident is treated as a deemed disposal) –
100 Microsoft shares at current market price of $2 = $200.

I posed the question to Just One Lap and an unsigned reply came back within 3 minutes. The person said that the investment in $ must be converted to zar. ie, the base cost, purchase cost and gain must be converted to zar.

Then I found the SAIT website that explains how the Paragraph 43 of the 8th schedule works and sent it to them. Not heard back as I'm sure they are looking into it and we will have a podcast on this soon.

http://www.thesait.org.za/news/309334/The-Tax-Implications-of-Currency-Gains-made-on-Foreign-Investments-.htm

If this is also applicable to Portugal which I think it is (best international practice) then my tax bill of €12k will be zero.

My gain was €46k and with this it would be a loss of €9k. A R3 change from buy and sell makes a huge difference.

Update. If you transfer zar to usd the conversion is made. You can hold it in cash with your US broker or bank for as long as you like.
When you make a purchase it must be made in USD as it is your base currency that you employed. Not ZAR as the exchange rate conversion has already been made. 

Now when you calculate your gain/loss you must do it in USD and only then do you convert it to zar. As Patrick has said, you can choose the average yearly FX rate or the rate at the date of sale. You can choose what rate is better for tax purposes.
If you choose not to use the ave rate then you have to use the rate at SETTLEMENT and not the TRADE date. This can differ by 1 to 2 %.