• Aug 6, 2025
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Property Transfer Duties in South Africa: Everything You Should Know

Buying or selling property in South Africa comes with a lot of excitement—but also a few financial obligations you need to be prepared for. One of the most significant costs when purchasing property is the transfer duty, a tax payable to the South African Revenue Service (SARS). Many property buyers are surprised by this additional expense, especially if they are first-time buyers. In this guide, Zizipa Attorneys CEO, Deliah Zizipa will explain everything you need to know about property transfer duties, how it’s calculated, who is responsible for paying it, and why having a conveyancing attorney is essential to make the process smooth and stress-free.

What is Property Transfer Duty?

Transfer duty is a tax imposed by the South African government on the transfer of immovable property from one person to another. This duty is collected by SARS and is legally required before a property can be legally transferred to a new owner. The Transfer Duty Act governs this payment, and it ensures that property transactions are formally recorded and taxed accordingly. Whenever you purchase a house, vacant land, commercial property, or any other immovable property, SARS expects transfer duty to be paid before the property’s ownership is officially transferred to you.

Who Pays Transfer Duty?

In South Africa, it is the purchaser—not the seller—who is responsible for paying transfer duty. This is a crucial factor to keep in mind when planning your budget for a new property. In addition to your deposit and bond registration costs, you must also factor in the transfer duty fee, which can significantly increase the upfront costs of buying property. There are exceptions: certain transactions may be exempt from transfer duty, such as property transfers due to inheritance, certain donations, or transfers between spouses. However, in typical real estate transactions, it is always the buyer who carries the obligation.

How is Transfer Duty Calculated?

Transfer duty is calculated on a sliding scale based on the purchase price of the property. SARS updates these thresholds from time to time, so it’s important to always work with the latest rates.

Here’s how it works (2025 Example):

• Property value up to R1,100,000: No transfer duty payable.
• R1,100,001 to R1,512,500: 3% of the value above R1,100,000.
• R1,512,501 to R2,117,500: R12,375 plus 6% of the value above R1,512,500.
• R2,117,501 to R2,722,500: R48,675 plus 8% of the value above R2,117,500.
• …and so on.

Example:

If you purchase a home for R1,300,000, you will pay 3% on R200,000 (R1,300,000 – R1,100,000) = R6,000.

VAT vs. Transfer Duty

It’s also important to note: you do not pay transfer duty if VAT applies. If a property seller is VAT registered and the sale is subject to VAT, you won’t pay transfer duty, but VAT will be included in the purchase price.

Exemptions and Discounts on Transfer Duty

South Africa offers several transfer duty exemptions to provide relief in specific scenarios:

• First R1,100,000 of any property purchase is tax-free (as of 2025).
• First-time buyers benefit from this threshold just like seasoned buyers.
• Spousal transfers are exempt in cases of divorce or inheritance between spouses.
• Inheritance and donations often qualify for exemptions under certain conditions.
• Properties sold by VAT-registered developers are subject to VAT but exempt from transfer duty.

These exemptions make it easier for lower-income buyers and first-time homeowners to enter the property market without excessive costs.

Timeline for Paying Transfer Duty in South Africa

Transfer duty must be paid within six months of the date of sale. Failure to meet this deadline results in penalties and interest, which can accumulate rapidly. Typically, the conveyancer managing your property transfer process will handle the payment of transfer duty. They’ll calculate the correct amount, submit the necessary forms to SARS, and ensure payment is made on time. You simply deposit the funds into the conveyancer’s trust account, and they do the rest.

SARS Transfer Duty Receipt: What It Is and Why It’s Important

Once the transfer duty has been paid, SARS issues a Transfer Duty Receipt (also called a Transfer Duty Certificate). This document is absolutely essential—it’s the proof that transfer duty has been settled. The Deeds Office will not register the transfer of property without this receipt. Your conveyancer will obtain this on your behalf, ensuring everything is legally compliant before your property is registered in your name.

Recent Changes and Updates to Transfer Duty Rates

Transfer duty thresholds are periodically updated by SARS, typically announced during the National Budget Speech. Staying informed about these changes can help you plan your property purchases more effectively.

Recent Highlights:

• The R1,100,000 exemption threshold remains a significant saving for buyers.
• Periodic inflation adjustments may impact how much transfer duty you’ll pay.

Your conveyancer will always use the most up-to-date rates applicable at the time of the transaction.

Frequently Asked Questions

Can transfer duty be included in my home loan?

No. Transfer duty must be paid upfront and cannot be financed through your mortgage bond. This cost must be paid from your own funds before the transfer is registered.

Is transfer duty refundable if the sale falls through?

Yes. If a sale is cancelled after transfer duty has been paid, SARS will refund the amount, although the process can take some time.

What if I’m buying a sectional title or a share in a company?

If you buy shares in a share block scheme, transfer duty still applies. However, if you purchase a sectional title unit, the process works the same as freehold property transfers.

Why Use a Conveyancing Attorney for Your Property Transfer

Navigating transfer duty regulations can be confusing, especially with changing thresholds and exemptions. An experienced conveyancing attorney ensures:

• Accurate calculation of transfer duty
• Timely submission and payment to SARS
• Acquisition of the Transfer Duty Receipt
• A legally compliant and smooth property transfer

Having the right legal guidance prevents costly errors, delays, and penalties—giving you peace of mind throughout the transaction.

Conclusion

Understanding property transfer duty is an essential part of buying property in South Africa. With proper planning and professional guidance, you can avoid unpleasant surprises and ensure a smooth property transfer. At Zizipa Attorneys we offer experienced and efficient residential conveyancing and commercial conveyancing services to guide you through every step of your property purchase or sale. Contact us today to get started with a seamless, stress-free property transfer process.