The South African Revenue of Services (SARS) recently made changes to the transfer duty declarations required for all immovable property transfers.
These changes are, briefly and inter alia:
- A tax reference number will now be required for both sellers and purchasers. In respect of natural persons this will only apply to transactions above R2 million.
- In the past, when purchasers or sellers were not registered for tax, the conveyancer, would obtain details of all their annual sources of income and prepare an affidavit wherein the client would, under oath, confirm their annual income, and this would be captured by the conveyancer in the transfer duty application.
This has now changed, and the only time a tax reference number is not required is when the purchaser or seller is
- a minor
- unemployed
- earning under the income tax threshold
- a foreign individual; or
- the transfer is between the parties as a consequence of divorce
A false statement is a criminal offence under section 235 of the Tax Administrative Act.
The purpose for the change is to simplify compliance, reduce inaccurate declarations, and improve tax collection.