BUDGET SPEECH 2017 – How does it affect the property market this year?

Transfer Duty

It has been announced that Transfer Duty (the tax on the purchase of property) will now only be levied on a purchase price of R900 001 and up.

This will only be effective from the 1st of March 2017 which means the rates will only apply to contracts entered into on the 1st of March 2017 and onwards.

Transfer Duty will now be payable at the following rates on transactions that are not subject to VAT:

Value of the property (Rand) Transfer Duty rate payable R0,00 – R900 000 0%

transfer duty payable R900 001 – R1250 000 3%

of the value above R900 000 R1250 001 – R1750 000 R10 500 + 6%

of the value above R1250 000 R1750 001 – R2250 000 R40 500 + 8%

of the value above R1750 000 R2250 001 – R10 000 000 R80 500 + 11%

of the value above R2250 000 R10 000 001 and above R933 000 + 13%

of the value above R10 000 000

Taxation of Capital Gains

Capital Gains Tax (the tax payable on the “profit” made on the disposal of an asset) are included in taxable income.

Maximum effective rate of tax will be as follows:

Individuals and Special Trusts 18% Companies 22,4% Other Trusts 36% *The first R2million profit on the sale of your primary residence will still be excluded from Capital Gains Tax. (Please keep in mind that the property must be registered in your personal name for this rebate to apply.)

Should you be in the process of buying or selling a property feel free to contact our offices for assistance on:

T: 011 465 3809

E: chrisna@richeattorneys.co.za