Having said that there is no terrible news there is some gain and some pain. To the average man in the street there is gain and for the wealthy there is unfortunately some pain. The Minister announced that for all sales of immovable property concluded on or after the 1st March of this year the transfer duty tariff is to be amended. The new transfer duty tariff will be as follows: Sale price of property (R) Rate:
| 0 – 750 000 | 0% |
| 750 001 – 1 250 000 | 3% of the value above R750 000 |
| 1 250 001 – 1 750 000 | R15 000 + 6% of the value above R1 250 000 |
| 1 750 001 – 2 250 000 | R45 000 + 8% of the value above R1 750 000 |
| 2 250 001 and above | R85 000 + 11% of the value above R2 250 000 |
The current transfer duty tariff is as follows: Sale price of property (R) Rate
| R0 – R600 000 | 0% |
| R600 001 – R1 000 000 | 3% on the value above R600 000 |
| R1 000 001 – R1 500 000 | R12 000 plus 5% on the value above R1 000 000 |
| R1 500 001 and above | R37 000 plus 8% on the value above R1 500 000 |
The new tariff therefore provides homebuyers in middle income households some relief on transfer duties but requires more from those who purchase in the higher price brackets. In a nutshell for sales on or after 1 March 2015, transfer duty will be:
- eliminated for all property acquired up to R750 000 (previous threshold was R600 000);
- decreased for all properties acquired up to around R2.6 million; and
- increased for all properties above R2.6 million.
To demonstrate the impact of these new tariffs a person buying for R2 500 000 would currently have to pay R117 000 and with the new tariff will pay R112 500. If that person buys for R3 500 000 then he would currently pay R197 000 and with the new tariff will pay R222 500.
Issued by:
Mr Milton Koumbatis
