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Orca - maybe I am looking at this issue too simplistically but my tax form requires that you provide "proceeds" and "base costs". So if you buy more shares now you are likely to be buying at a higher price than your first parcel, thus when you buy subsequent parcels the base cost would rise - so in 3 years when you sell you would then have a higher base cost and you proceeds would be diminished by this higher base cost and as such your CGT would be less. However the problem comes in when you buy a second parcel of the same shares at a lower price than the 1st parcel as this would depress your base cost. To play it safe I would print a copy of your brokers portfolio listing which evidences your base costs, and then make purchases and do a screen print again - hold these prints in a tax file until the 3 year period has elapsed on the first parcel and the second printout when the 2nd parcel gets to its 3 year window. I have a brilliant financial package which mirrors all my accounts and I capture every transaction on it be it current, cards, savings, investments ,shares mutual funds as it gives me one figure net worth. The package is Quicken but you can't acquire it anymore as the American bought it from the South African company and they won't open the system to multi currencies - only available in US$. One of its components is shares and a share portfolio and it logs dates of purchases and sales so I can always check dates of purchases, base costs and then upon sales date of sale proceeds (less brokerage) etc. This Quicken is one of the best home finance packages I have ever seen and it has the capability of absorbing data from your internet banking and daily share prices etc. It has a budgetary component where you can set budgets into the future, produce pie charts interrogate your income and expenditure and it was available in the early 2000's - I am running on the 2004 version and hope that it never crashes (did once in 2005 but recaptured and put in another hard drive on my computer as back up) 

I hear what you are saying gcr. My broker sends me a yearly summary for tax purposes that is quite adequate for working out my tax. My job is to see to the Base Cost. This I do and print out the Contract Note and file it.

When you stop "trading" your stocks and Change your Intention to Investing, you have to deem your stocks as 'sold" and pay the tax at market value whether you sold or not.

I fortunately sold off my whole portfolio before some bad news and bought back in afterwards. Since then, I have not sold or added to them and consider them as Investment Stocks since then. I now have just over a year to go for the 3 year thingy to Upgrade to CGT.

Post getting too long for attention span. Part 2 coming.

I doubt that..... how does one pay tax on an unrealized "profit"

3 year rule... and tax when you sell

that could perhaps be different, as SARS wants to grab the last bit they can, but with shares, I never 'inform' them that I'm now selling a trade or an investment - I simply use the period I held the shares and then deduct PAYE or CGT

I just let the conclusion guide me

19. Conclusion
Section 9C provides taxpayers with certainty that if they hold equity shares for at least three continuous years the gains and losses on disposal will be of a capital nature regardless of the intention with which the shares were originally acquired. The section has a much wider application than its predecessor (section 9B) in that it covers unlisted shares and a member’s interest in a close corporation instead of only JSE-listed shares. But not all types of shares qualify under section 9C; for example, non-participating preference shares, shares in foreign companies (other than JSE-listed shares) and participatory interests in portfolios of collective investment schemes in property fall outside section 9C. Its provisions are now mandatory and no election is required or even possible. The wider ambit of section 9C has necessitated the inclusion of a number of anti-avoidance measures. The capital or revenue nature of shares disposed of within three years of acquisition will continue to be determined according to principles laid down by case law.

Guys I am new at this so help me right.

Guys, if you buy a share and it goes up that is good, but then if the share starts falling after reaching a nice profit point, you have to sell it to lock in the profit.
Then the tax rule of not keeping the share for 3 years kick in and you are seen as a trader. That means you pay extra tax/CGT or whatever.
Here is my question - how much tax/cgt do you pay because that tax is actually your loss. You have to deduct that from your profits. Further more if you buy a share that goes into profit slowly, yes you are making profit but your capital is locked in for 3 years otherwise you will get this special tax being applied.
So what is the use of buying any share that is even semi volatile? You might make nice profits but your profits must always be more than the tax/cgt deduction for you to make a profit.
That means you have to concentrate on shares that you know will have a good 3 year run. I mean, come on, who knows what a share will do in 3 years time?

But just for clarity as I am not sure - If I buy a share for R10 today and sell it next week at R20, how much will I be punished by SARS?

Orca is the man for tax, Mr Bond aswell (I think). The first R30 000 is tax free, thus you only pay tax on profits above R30,000 profit. Unless of course they change it.

Your divvie is taxed before it gets paid to you.

No it is total - not per share / comp you sell. Please note I am no tax expert, I believe you need to try and make money, if you limit yourself - i.e. scared of making profit cause you scared of paying tax, it is not the right thing. Go to SARS website and read their papers on shares / tax.