Page 58 - Profmark_Estate_Planning_Guide_2025

TRANSFER DUTY

n Transfer duty is an indirect tax on the acquisition of immovable property
situated in South Africa. The following are the main provisions:
u It is calculated on the value of the immovable property (purchase price or
market value whichever is the highest).
u It is payable within six months after the transaction is entered into.
u Where a registered VAT vendor purchases property from a non-vendor, the
notional input tax is calculated by multiplying the tax fraction [15/115]
by the lesser of the consideration paid or market value.
u The acquisition of a contingent right in a trust that holds a residential
property or the shares in a company or the member’s interest in a close
corporation which owns residential property comprising more than 50%
of its assets, is subject to transfer duty at the applicable rate.

Transfer duty, with effect from 1 April 2025, is calculated as follows:
R1 – R1 210 000 0%
R1 210 001 – R1 663 800 3% of the value above R1 210 000
R1 663 801 – R2 329 300 R13 614 + 6% of the value above R 1 663 800
R2 329 301 – R2 994 800 R53 544 + 8% of the value above R 2 329 300
R2 994 801 – R13 310 000 R106 784 +11% of the value above R2 994 800
R13 310 001 + R1 241 456 + 13% of the value over R13 310 000

The most notable exemptions from transfer duty are the following:
n If the purchase price/value is R1 210 000 or less.
n If the transaction is subject to VAT (i.e. where the seller is a VAT vendor).
n In the event of immovable property being transferred to a person (including a
close corporation, company or trust), in terms of a Last Will and Testament,
or as a result of intestate succession.
n The transfer of any property to a surviving spouse, or divorced person, who
acquires sole ownership of the whole or any portion of property registered
in the name of his or her deceased or divorced spouse where that property

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