# Gifts to Other Persons

![](https://1369014650-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FwDn56IBmTGJCP7opAx1T%2Fuploads%2FcTv8VpXEix6fz9QRFvTL%2FSouth%20African%20Crypto%20Tax%20-%20Gifts.png?alt=media\&token=89f56b77-5aca-48f3-9087-04aa4fa92e5b)

## How Can I Gift Crypto?

Gifting crypto assets is another aspect of the crypto-sphere where tax agencies, such as SARS, do not offer concrete advice.

Cryptoassets can be gifted through a multitude of mediums such as:

* Through centralized exchanges, where assets can be easily tracked and linked to your KYC information
* Self-custodial wallet gifting, completely anonymously 
* Sharing private keys or ledgers with close friends and family

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Remember to always confirm the recipient's wallet address with a small transaction first!
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Without being able to directly track the movement of cryptoassets, let's find out how SARS has decided to tax any crypto gifts.

### Tax Treatment

Through lack of definitive advice from SARS, we **assume** gifting crypto to others is seen as a *disposal,* triggering a capital gains tax event. 

{% hint style="info" %}
Unlike donations in South Africa, there is no annual exemption for gifts.
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The recipient of the cryptoassets, will only be taxed once they decide to *dispose* of the asset. 

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Recipients cost basis' will be calculated at market value the day they receive their crypto assets.
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Like recipients, the disposals value will be the fair market value of the crypto assets as you can see in the example below.

### Example

Annie and Mary are both crypto investors, frequently talking to each other about the market.

Mary's birthday is soon and Annie wants to gift her some TRAC as a present. 

Annie sends 100 TRAC over to Mary's wallet on her birthday, worth R7,000 at the time of the gift. 

(Consequently, this is now Mary's *cost basis* and Annie's proceeds)

Having bought her first 100 TRAC for R1,000, Annie must follow SARS *First in First Out* principles, leaving her with a gain of R6,000, of which 40% can be taxed.

R2,400 \* 18% (6,000 \* 40%) = **R432 payable**. 

When Mary decides to sell her TRAC, she will use R7,000 as her cost basis.