Transfer Duty: 2010 vs 2011
The transfer duty rates for individuals, trusts, companies and CC’s purchasing property have come down in 2011 as announced by Mr Pravin Gordhan in his 2011 Budget Speech.
This is a welcome relief in the costs associated with purchasing property.
The change in the method of calculation is as follows:
Method of calculation: 2010
R0 – R500,000: 0%
R500,000 – R1000 000: 5% on the value between R500,000 and R1,000 000 plus
R1,000,000 and above: 8% on the value above R1,000,000
Method of calculation: 2011
R 0 – R 600,000,00: 0 %
R 600,000 – R 1,000,000: 3 % of the value between R 600,000,00 and R1,000,000 plus
R 1 000,000 – R 1,500,000: 5 % of the value between R 1,000,000 and R1,500,000 plus
R 1,500,000 and above: 8 % of the value over R 1,500,000,00
Example 1: Purchase price is R1,000,000
In 2010, transfer duty would have been R 25,000.
In 2011, the transfer duty is reduced to R 12,000.
Calculated as follows:
Value between R0 and R600,000 = R0
Value between R 600,000 to R 1,000,000: 3 % of R400,000 = R 12, 000
R0 + R12,000 = R12,000
Example 2: Purchase price is R1,500,000.
In 2010, transfer duty would have been R 65,000.
In 2011, the transfer duty is reduced to R 37,000.
Calculated as follows:
Value between R0 and R600,000 = R0
Value between R 600,000 to R 1,000,000: 3 % of R400,000 = R 12, 000
Value between R1,000,000 and R1,500,000: 5 % of R 500,000,00= R 25,000,00
R0 + R12,000 + R25,000 = R37,000
