[Question] Gain/Loss on business property, revenue or capital in nature?

[Dodo]

Hi ForumSA

I have sold a property that was purchased by the company 5 years ago. The property ha only used as office space for the company.
No residential use
No rental income

There is a loss on the sale of the property. Buying and selling property is not primary activity of the business. At purchase, the intended use of the property was office space.
Will the loss be capital or revenue in nature?

Any source material would be great

[Andromeda]

Presumably there were no allowances claimed. Otherwise the proceed would represent a recoupment. If the proceed is less than the total cost charged over the years to SARS, then that shortfall is a capital loss. Capital losses are not offset against normal profit but will stay there just about forever to be offset against a capital gain, which for a small business seldom happens.

[heathermalone]

It comes under a capital loss I guess. You have incurred a loss while selling the property and made no revenue while you were holding it. This means, you made no profit on the capital invested on the property.

[Dave A]

It comes under a capital loss I guess. You have incurred a loss while selling the property and made no revenue while you were holding it. This means, you made no profit on the capital invested on the property.

No need to guess with Andromeda around