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 Although
South African property laws are widely regarded as progressive and encouraging
to foreign investors, buyers from overseas can be surprisingly ignorant
about the terms and conditions under which they own their properties,
says Lanice Steward, MD of Anne Porter Knight Frank.
In particular, says Steward, she has more than once had to remind non-resident
owners that if they sell any property at a price of R2 million or more,
they (or their attorneys) have to pay capital gains tax 5% of the sale
price to SARS on transfer.
If the property is owned by means of a company or a trust the capital
gains tax is 7,5% and 10%.
Non-residents should register with SARS and get an income tax number
when they decide to sell. Once this is done, said Steward, it is possible
for non-resident sellers to apply to SARS for their capital gains tax
to be calculated on the individual rate (5%). If sellers contact SARS
timeously, they will be given a tax number (if they do not have one already)
and can then apply for a re-assessment of capital gains on their property.
“The savings here can be very significant,” said Steward.
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Newsletter:
03 September 2010 to 10 September 2010 - Focus on Bloemfontein, Free State, South Africa
