> For the complete documentation index, see [llms.txt](https://docs.recap.io/south-african-tax-guide/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.recap.io/south-african-tax-guide/transaction-types/gifts-to-other-persons.md).

# Gifts to Other Persons

![](/files/sDuSwIYlMpr4HZThQMLQ)

## 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

{% hint style="danger" %}
Remember to always confirm the recipient's wallet address with a small transaction first!
{% endhint %}

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.
{% endhint %}

The recipient of the cryptoassets, will only be taxed once they decide to *dispose* of the asset. 

{% hint style="info" %}
Recipients cost basis' will be calculated at market value the day they receive their crypto assets.
{% endhint %}

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.