Sky Software
Help and User guide

Assets and Liabilities

The screen below indicates a summary of the capital reconciliation on an IT12 tax return.   On the right hand side you have the Capital Recon with the annual living expenses calculated  and the monthly living expenses on the bottom right hand side.  On the left hand side you have a summary of assets and  liabilities.  There is a button called assets and liabilities on the bottom and if you click on this, this will take you to the asset and liability screen which you will see shown further below.  Just below the asset and liability button is a refresh tab, which you should click on to get the latest capitial reconciliation calculation
If you are doing your IT12 tax returns properly then it is fundamental that you carry out the capital recon test.  It is necessary to work out that the living expenses in fact fit in with the income that the taxpayer is declaring to SARS and the taxpayers life style.
The beauty about the assets and liabilities is that you only have to enter the assets once as it works across all years.  For example if you enter the primary house which has been acquired 10 years ago and it has not been sold and there is no movement there is nothing to do as the assets and liabilities are date driven.  When there is a change for example like improvements or you sell the asset, you would need to tell the system what the sale price is and the system will calculate capital gains.
By changing the year on top by clicking on the appropriate year the net asset balances will change and the living expenses will recalculate. It's imperative that you make sure that the living expenses for each year is reasonable within the income declared.

The screen below shows line by line assets and liability maintenance which is a schedule of all the assets.  You can change to this  view by clicking on the view switch icons and you will then get the screen  further below which shows the detail of the individual asset. Use the switch view icons to switch between the list view and the individual view of the assets. There are 2 ways the modify the cost. On the list view click on the Nett amount and right click to type in the new cost.
The screen below shows the assets and liability maintenance for one asset and this is where you would need to make all the necessary changes for one asset.   On the screen below you will see that the asset acquired in 2012 for R500 000 now includes an alteration of R1000000 and this has now made the total asset R2000000.  When the asset is sold you would need to complete the bottom part of the screen showing the sale.
When entering a new asset insert the date and the cost amount.

By inserting the base cost and the base cost year and inserting the sale amount of the assets the system will calculate the capital gain that is to go into the tax calculation.
Selling a portion of the assets
Where a portion of the assets are sold it is best to create another asset record and transfer the remaining amount to that asset account and then entering the details for the sale of the portion that is sold to work out the capital gain. Please click on the link below.
17 November 2021