What is a transfer duty?
A property transfer duty is a levy that all buyers of properties worth more than R1 000,000 must pay. Transfer duty is owed in addition to the selling price and is calculated on the property's value rather than the price.
When is transfer duty payable?
The buyer must pay transfer duty within six (6) months of the date of purchase. If the Transfer Duty is not paid within this time frame, interest will be charged at 10% per month. The first day from the end of the interest-free six-month period to the payment date is considered a completed month.
How do you pay transfer duty?
All Transfer Duty must be paid electronically via eFiling from 1 April 2011. A Conveyancer, who operates on your behalf, will usually handle this.
These are the Transfer Duty rates applied to properties acquired on or after 1 March 2020 and apply to all persons (including Companies, Close Corporations, and Trusts).
It is important to understand how to calculate your transfer duty and the mechanics behind how transfer costs are created. SARS has a breakdown of transfer duties over the last few years.
Calculate your transfer duty using the information below.
|Value of the property (R)||Rate||1 – 1000 000||0%|
|1 000 001 – 1 375 000||3% of the value above R1 000 000|
|1 375 001 – 1 925 000||R11 250 + 6% of the value above R 1 375 000|
|1 925 001 – 2 475 000||R44 250 + 8% of the value above R 1 925 000|
|2 475 001 – 11 000 000||R88 250 +11% of the value above R2 475 000|
|11 000 001 and above||R1 026 000 + 13% of the value exceeding R11 000 000|
No transfer duty is payable if the transaction is subject to VAT.
Transfer duty exemptions
Marriage in community of property
If a property owner marries in community of property, their spouse instantly becomes a half-share owner of the property without paying any transfer duty.
If a property is awarded to a spouse as part of a divorce settlement, there is no transfer duty. All marital regimes and civil unions are excluded from the exception. The spouse who obtains the property will be liable for transfer duty if the property is not granted to a spouse in terms of a divorce order and the parties negotiate an arrangement outside of the formal divorce proceedings.
Regardless of their relationship to the deceased and whether or not the deceased died without a valid will, heirs and beneficiaries are excused from paying any transfer costs on property inherited from a deceased estate.
Cancelled purchase transactions
If a property purchase is cancelled before the transfer is registered at the Deeds Office, SARS will not charge transfer duty if the cancellation is deemed legal.