The recent announcement by the South African Revenue Service (SARS) that it has implemented a flat rate of stamp duty is making waves in the property industry because it effectively doubles the duty paid on property leases of five years or less. Moreover, it was implemented by SARS without first being gazetted, and SARS did not consult with the South African Property Association (Sapoa) as expected.
The flat rate is now 50c per R100 or part thereof. It was 25c per R100 on leases of five years or less, 40c per R100 on leases of five to 10 years, 50c per R100 on leases of 10 to 20 years, and 70c per R100 on leases of 20 years or more.
The amendments come into retrospective effect from 1 January this year.
Article on Business Day