More changes in property related laws



ESTATE AGENTS AND TAX: THE LATEST Not a year goes by without changes in property-related laws, or the introduction of new legal requirements for estate agents to comply with. This year is barely two months old, and already there are three new laws - and a fourth one pending - which are designed to make estate agents help the SA Revenue Service to collect more taxes more efficiently. New stamp duty - leases signed on or after 1 January 2005 must be stamped at the rate of 50c per R100 (or part thereof) of the dutiable value. Dutiable value now consists of (a) the rental, and (b) any other monies, such as rates and taxes, which the tenant has to repay to the landlord in terms of the lease. Stamp duty must be paid within 30 days after the lease has been signed. However, if you cannot calculate (b) in advance, then the stamp duty on it (but not on the rental) must be held over until the end of the financial year, when you must calculate it on the amount actually paid. Reporting sales of company-owned residential properties - since December 2002, transfer duty has been payable on the sale of a residential property which is owned by a company, a close corporation or a trust, even if the purchaser buys the company/CC/trust and the sale isn't recorded in the Deeds Office. It is now an estate agent's duty to report such a sale to the SA Revenue Service, so that SARS can make sure that the transfer duty is paid. The report must be submitted not later than six months after the sale, on a form to be provided by SARS. VAT invoices - from 1 March 2005, if you issue a VAT invoice to a client who is also registered as a vendor for VAT, you must include the client's VAT registration number on the invoice as well as your own. For further details on any of the above, contact your local SARS office or visit their website (www.sars.gov.za). You should also contact SARS if you have a tax directive concerning PAYE deductions from your commission, as the current (2004-05) directive will expire on 28 February and you will need to obtain a new one for 2005-06. Withholding tax - with effect from a date which is still to be announced, SARS will be tightening up the collection of CGT on the sale of properties owned by non-residents. If the selling price is R2 million or more, then 5% of the proceeds of the sale (or 7.5% if the seller is a non-resident company, or 10% if it is a non-resident trust) will have to be deducted and paid over to SARS before the proceeds are sent offshore to the seller. It will be the buyer's responsibility to make sure that the tax is paid - if it isn't, then the buyer can be held liable for paying it himself. It will be both the conveyancer's and the estate agent's responsibility to inform the buyer in writing of his responsibility - if either or both of them fail to inform the buyer, then they too can be held liable for payment of the tax. We’ll advise our members when this measure comes into operation.