Buying property as a natural person means buying the property in your own name i.e. as an individual and not in a legal entity such as a Close Corporation, Company, or Trust.
If you are married in community of property by South African law, or by customary law or by the laws of any other country, then your spouse is legally required to sign the offer to purchase if you are buying or selling a property as an individual.
Buying property in your own name without the protection that a legal entity such as a Close Corporation, Company, or Trust offers can be risky. This is particularly relevant for people that run their own business and purchase their home in their own name. If at any time you are unable to pay your creditors, the home that you live in as well as any other properties that you own in your own name may become the prime target of your creditors.
Taxes:
A natural person:
- Pays transfer duty at the following rates for properties acquired on or after 1 April 2025:
Value of property (R) | Rate |
0 – 1,210,000 | 0% |
1,210,001 – 1,663,800 | 3% of value above R1,210,000 |
1,663,801 – 2,329,300 | R13,614 + 6% of value above R1,663,800 |
2,329,301 – 2,994,800 | R53,544 + 8% of value above R2,329,300 |
2,994,801 – 13,310,000 | R106,784 + 11% of value above R2,994,800 |
13,310,001 and above | R1,241,456 + 13% of value above R13,310,000 |
- Pays Capital Gains Tax: tax on disposal (sale or death), except on your primary residence where the first R3, 000,000 capital gain is excluded. The 2026 Budget increased the capital gains tax exclusion for primary residences from R2,000,000 to R3,000,000, effective for disposals from 1 March 2026 onward. If the sale agreement became binding before 1 March 2026 (even if transfer/registration happens later), the R2,000,000 exclusion still applies — the date the agreement was concluded governs, not the transfer date.
- Will be liable for Estate duty – an abatement of R3,500,000 is deducted from the net value of the estate to arrive at the dutiable value. Estate duty is then levied on the dutiable value at 20% on the first R30,000,000, and 25% on the dutiable value above R30,000,000. The R3,500,000 abatement is portable between spouses — if unused by the first-dying spouse, it rolls over, giving the survivor’s estate an abatement of up to R7,000,000.
Other Tax Considerations:
VAT:
No transfer duty is payable if the seller is registered for VAT (and the property is part of the operations for which the seller is registered), but VAT at the rate of 15% is payable. If the contract does not specify that the VAT is to be paid over and above the purchase price, then it is deemed to be included in the purchase price.
If the property is sold as a rental enterprise or as a going concern e.g. a guesthouse, the deed of sale must contain certain specific provisions and may be zero rated for VAT. This means that no transfer duty or VAT is payable.
If the purchaser registers for VAT, then the Vat (or the transfer duty) can be claimed back as an input credit in certain defined circumstances.
Income Tax:
If a property investor does not acquire a property with the intention of holding it for an indefinite period or for rental purposes, but with the intention of selling it to make a profit, then SARS may well regard the investor as a dealer and levy income tax at the investor’s tax rate on the profit. Capital gains tax will not apply if income tax is payable.
