Transfer duty is a tax levied on the acquisition of immovable property. It applies to all individuals buying property whether through a sale, donation, or inheritance and is calculated based on the purchase price of the property (or the market value, whichever is higher).
Who pays it? The buyer. The purchaser is responsible for paying transfer duty to SARS before the transfer can be registered at the Deeds Office. Without a transfer duty receipt, registration cannot proceed.
When is it paid? Transfer duty must be paid within six months from the date of acquisition typically the date the Offer to Purchase is signed. If you miss this deadline, SARS will charge interest penalties.
Who collects it? Your conveyancing attorney handles the process they submit a transfer duty declaration to SARS via eFiling and arrange payment on your behalf.
Simple definition: Transfer duty is a government tax on property purchases, paid by the buyer to SARS. It's not the same as transfer costs (legal fees).
Transfer duty is just one part of taking ownership of a property. For the full picture of what ownership means, how it's proven, and the different structures available, see our complete guide to property ownership in South Africa.
Transfer Duty vs Transfer Costs — Don't Confuse Them
Transfer duty is often confused with transfer costs, but they are different things:
| Transfer Duty | Transfer Costs | |
|---|---|---|
| What it is | Tax payable to SARS | Legal and administrative fees |
| Who gets paid | South African Government (SARS) | The conveyancing attorney |
| When it's paid | Right before transfer is lodged | At the start of the transfer process |
| What it covers | Government tax on property acquisition | Conveyancing fees, deeds office fees, bond registration fees |
Important: Even if you're exempt from transfer duty, you'll still need to pay transfer costs to your conveyancer for handling the legal transfer of the property.
2025/2026 Transfer Duty Rates
Effective from 1 April 2025, the following transfer duty rates apply to all property acquisitions (including individuals, companies, trusts, and close corporations):
| Value of the Property (R) | Transfer Duty Rate |
|---|---|
| 0 – 1,210,000 | 0% (no transfer duty) |
| 1,210,001 – 1,663,800 | 3% of the value above R1,210,000 |
| 1,663,801 – 2,329,300 | R13,614 + 6% of the value above R1,663,800 |
| 2,329,301 – 2,994,800 | R53,544 + 8% of the value above R2,329,300 |
| 2,994,801 – 13,310,000 | R106,784 + 11% of the value above R2,994,800 |
| 13,310,001 and above | R1,241,456 + 13% of the value exceeding R13,310,000 |
Source: SARS, effective from 1 April 2025
What this means for you:
- If you're buying a property for R1.2 million or less, you pay zero transfer duty
- As the property value increases, you pay a progressively higher percentage on the portion above each threshold
How to Calculate Transfer Duty (With Examples)
Here's a step-by-step method to calculate transfer duty:
- Find your property value (purchase price or market value, whichever is higher)
- Check which bracket it falls into using the table above
- Apply the rate to the portion of the value that exceeds the bracket's lower limit
- Add any base amount if applicable
Example 1: Property Purchased for R1,000,000
| Step | Calculation |
|---|---|
| Property value | R1,000,000 |
| Bracket | Below R1,210,000 |
| Rate | 0% |
| Transfer Duty Payable | R0 |
Example 2: Property Purchased for R1,500,000
| Step | Calculation |
|---|---|
| Property value | R1,500,000 |
| Value above threshold | R1,500,000 – R1,210,000 = R290,000 |
| Rate | 3% |
| Transfer duty | 0.03 × R290,000 = R8,700 |
| Transfer Duty Payable | R8,700 |
Example 3: Property Purchased for R2,000,000
| Step | Calculation |
|---|---|
| Property value | R2,000,000 |
| Base amount | R13,614 |
| Value above R1,663,800 | R2,000,000 – R1,663,800 = R336,200 |
| 6% of excess | 0.06 × R336,200 = R20,172 |
| Transfer duty | R13,614 + R20,172 = R33,786 |
| Transfer Duty Payable | R33,786 |
Example 4: Property Purchased for R2,500,000
| Step | Calculation |
|---|---|
| Property value | R2,500,000 |
| Base amount | R53,544 |
| Value above R2,329,300 | R2,500,000 – R2,329,300 = R170,700 |
| 8% of excess | 0.08 × R170,700 = R13,656 |
| Transfer duty | R53,544 + R13,656 = R67,200 |
| Transfer Duty Payable | R67,200 |
Example 5: Property Purchased for R5,000,000
| Step | Calculation |
|---|---|
| Property value | R5,000,000 |
| Base amount | R106,784 |
| Value above R2,994,800 | R5,000,000 – R2,994,800 = R2,005,200 |
| 11% of excess | 0.11 × R2,005,200 = R220,572 |
| Transfer duty | R106,784 + R220,572 = R327,356 |
| Transfer Duty Payable | R327,356 |
Example 6: Property Purchased for R15,000,000
| Step | Calculation |
|---|---|
| Property value | R15,000,000 |
| Base amount | R1,241,456 |
| Value above R13,310,000 | R15,000,000 – R13,310,000 = R1,690,000 |
| 13% of excess | 0.13 × R1,690,000 = R219,700 |
| Transfer duty | R1,241,456 + R219,700 = R1,461,156 |
| Transfer Duty Payable | R1,461,156 |
When You Don't Have to Pay Transfer Duty
You may be exempt from paying transfer duty in the following situations:
1. Property Below R1.21 Million
No transfer duty is payable if the property value is R1.21 million or less whether you're an individual, company, trust, or first-time buyer.
2. VAT Applies Instead
When you buy from a seller who is a VAT vendor (e.g., a developer selling a new property), you pay VAT instead of transfer duty. You never pay both VAT is usually included in the advertised price.
3. Inheritance from a Deceased Estate
Property inherited through a deceased estate is exempt from transfer duty. This applies regardless of the property's value.
4. Divorce Settlement
Property transferred between former spouses as part of a divorce order is exempt from transfer duty.
5. Marriage in Community of Property
When spouses marry in community of property, the spouse who gains half ownership of the other's property doesn't pay transfer duty.
6. Partnership Dissolution
Where property is being transferred amongst partners upon the dissolution or termination of a partnership agreement, no transfer duty is payable.
Remember: Exemption from transfer duty does not mean you're exempt from transfer costs. You'll still need to pay your conveyancer for handling the legal transfer.
VAT vs Transfer Duty — Which One Applies?
One way or another, you'll pay either VAT or transfer duty but never both.
| Scenario | What You Pay |
|---|---|
| Seller is a VAT vendor (e.g., developer selling new property) | VAT (usually 15%, included in the price) |
| Seller is NOT a VAT vendor | Transfer duty (0-13% depending on value) |
How to check: Ask the seller or estate agent whether the seller is registered for VAT. If they are, and the property is being sold as part of their business, transfer duty will not apply.
When Must You Pay Transfer Duty?
Transfer duty must be paid within six months from the date of acquisition typically the date the Offer to Purchase is signed by both parties.
What if you don't pay on time?
- Interest will be charged at 10% per annum for each completed month of delay
- The transfer cannot be registered at the Deeds Office without a transfer duty receipt
Note: In the case of conditional sales, the six-month period commences from the date the transaction was entered into i.e., the last date of party signature to the agreement not the date the conditions are fulfilled.
How to Pay Transfer Duty
The process is handled by your conveyancing attorney:
- Your conveyancer submits a Transfer Duty Declaration to SARS via eFiling
- Supporting documents are uploaded (if required)
- Payment is made (if applicable) via eFiling
- SARS issues a receipt (if no payment is required, the system automatically releases the receipt after approval)
- The receipt is lodged at the Deeds Office to register the transfer
Recent SARS Changes to Be Aware Of
From December 2025, SARS introduced enhancements to the Transfer Duty Declaration (TDC01) on eFiling:
- Tax reference number is now required for both sellers and purchasers (for individuals, this applies to transactions above R2 million)
- The annual income field has been removed
- A new "Divorced" option has been added under marital status
- "Not registered for income tax" option now available for individuals
- Enhanced validations to reduce inaccurate submissions
Tip: Ensure your tax affairs are in order before the transfer. If you're not registered for income tax or have outstanding returns, this may delay the transfer.
What If You Don't Pay on Time?
If transfer duty is not paid within six months, the consequences are clear:
- Interest at 10% per annum for each completed month after the six-month period
- No transfer can be registered at the Deeds Office without proof of payment
- Delays in registration can affect occupational rent and moving dates
- Transfer duty is a tax paid by the buyer to SARS when purchasing property over R1.21 million
- The rates are progressive, ranging from 0% to 13% depending on the property's value
- Payment must be made within six months of signing the Offer to Purchase
- No transfer duty applies if the seller is a VAT vendor selling a new property instead, you pay VAT (usually included in the price)
- Transfer duty and transfer costs are different you'll still need to pay your conveyancer even if you're exempt from transfer duty
- Exemptions apply for inheritance, divorce, spousal transfers, and partnership dissolution
