Property & Tax Guide

Property & Tax Guide

2017/2018

1st Floor, TransAfrica House, 1 Lower Road (cnr 10 Benmore Road),

Morningside, Sandton, 2196 (near Benmore Gardens Shopping Centre,

cnr Grayston Drive and West/ Benmore Road, Sandton)

Province of Gauteng, Republic of South Africa

P.O. Box 781754, SANDTON 2146

Tel: 011 884 9898 / 011 884 5840

Fax: 011 884 4450 Faxmail: 011 252 9242

Cell: 082 567 8642

Email: brenda@tanner.co.za Website: brendatanner.co.za

Principal: Brenda Joyce Tanner (nee Walker)

LLB (Natal) LLM (Wits)

All conveyancing matters and the transfer of all types of property situated

anywhere in South Africa.

CONTENTS

2017/2018 Budget Highlights 2 Normal rates of tax payable by natural

persons : 2016, 2017, 2018 3 ? 4 Transfer Duty on Immovable Property 5 Capital Gains Tax & Your Property 6 ? 8 The Deed of Sale 9 ? 11 Home Loans and Mortgage Bonds 12 The Consumer Protection Act 13 ? 17 Purchasing via Legal Entities ?

Pro's & Con's 18 The Protection of Personal Information Act 19 Tax Implications on the leasing of

property 19 ? 20 The Rental Housing Act 20

Sectional Title and Community Schemes 21 ? 31

Costs of Buying & Selling Property 32 ? 33 Exchange Control 34 Your Will & Your Property 35 Regulations for new buildings and

energy usage 36 Trusts 37 ? 39 Donations Tax 40 Estate Duty 41 Mortgage Bond Repayment Factors 42 Sale of Property Timeline 43 Comparative Tax Rates 44 Illustrative Table Of Bond &

Transfer Costs 45 ? 48

IMPORTANT NOTE AND DISCLAIMER

This guide is an easy reference, pocket-sized overview of the South African Tax System and residential property, incorporating announcements made in the Budget delivered on 22 February 2017 The information contained in this guide is a summary of current legislation, budget proposals and

property related information We suggest that you do not act solely on material contained in this guide as the nature of

the information contained herein is general and may in certain circumstances be subject to misinterpretation In addition, the budget proposals may not include all legislative adjustments which could be made in the near future The information is provided with the understanding that no legal or professional advice is being rendered in this guide We recommend that our advice be sought when encountering these potentially problematic areas It is specifically noted that the Table of Bond and Transfer Costs are illustrative in nature and based on recommended guidelines of fees issued by and on behalf of the various law societies from time to time Our fees may therefore vary from the guideline, based on the requirements of each specific matter quoted for While every care has been taken in the compilation of this guide, no responsibility of any nature whatsoever will be accepted for any inaccuracies, errors, or omissions

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2017/2018 BUDGET HIGHLIGHTS

New personal income tax bracket of 45% for taxable incomes above R15 million All rebates and taxable income bracket amounts, will be increased by 1 per cent from

1 March 2017 Tax rate for trusts other than special trusts has been increased to 45% Dividend withholding tax rate increased to 20% The annual allowance for tax free savings accounts will be increased to R33 000 Anti avoidance measures will be expanded to prevent taxpayers utilising companies as

a conduit for low interest loans to trusts With respect to employer provided exempt bursaries, it is proposed to increase the

income eligibility threshold for employees from R400 000 to R600 000, and the monetary limits for bursaries from R15 000 to R20 000 for education below NQF level 7, and from R40 000 to R60 000 for qualifications at NQF level 7 and above The exemptions from income tax for employees working outside South Africa for more than 183 days a year is to be narrowed to only apply where the income is subject to tax in the foreign country A 30c/litre increase in the general fuel levy A 9c/litre increase in the Road Accident Fund Levy The duty-free threshold on purchases of residential property will be increased from R750 000 to R900 000, effective 1 March 2017 Sugar Tax to be implemented as soon as necessary legislation approved by Parliament A revised Carbon Tax Bill will be published for public consultation and tabled in Parliament by mid-2017 Excise duties on alcoholic beverages and tobacco products will increase by between 61 per cent and 9 per cent

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