What is transfer duty?
Transfer duty is a tax paid to SARS when you purchase immovable property. It applies to properties bought from private individuals (not VAT-registered sellers). If the seller is a VAT vendor — such as a developer selling a new build — you pay VAT instead of transfer duty.
The tax is calculated on the purchase price of the property, using a sliding scale. Only the portion of the price that falls within each band is taxed at that band's rate.
The transfer duty threshold increased from R1,100,000 to R1,210,000 with effect from 1 April 2025. If you are working from an older guide, check the figures — any article showing R1,100,000 as the threshold is out of date.
The 2026 transfer duty table
These rates apply to all property transactions from 1 April 2025 onwards, and are unchanged for the 2026/27 tax year (confirmed in the February 2026 Budget).
| Purchase price | Rate |
|---|---|
| R0 – R1,210,000 | 0% (exempt) |
| R1,210,001 – R1,663,800 | 3% on the amount above R1,210,000 |
| R1,663,801 – R2,329,300 | R13,614 + 6% above R1,663,800 |
| R2,329,301 – R2,994,800 | R53,544 + 8% above R2,329,300 |
| R2,994,801 – R13,310,000 | R106,784 + 11% above R2,994,800 |
| Above R13,310,000 | R1,241,456 + 13% above R13,310,000 |
Source: SARS Transfer Duty rates
The R1,210,000 threshold means buyers purchasing at or below this price pay zero transfer duty. This is one of the most watched numbers in the South African property market — you will often see properties listed at R1,209,000 for exactly this reason.
Worked examples
Buying at R950,000
The purchase price is below the R1,210,000 threshold.
Buying at R1,500,000
The first R1,210,000 is tax-free. The remaining R290,000 falls into Band 2 at 3%.
Buying at R2,500,000
The price crosses two taxable bands. Each portion is calculated separately and added together.
Buying at R5,000,000
Transfer duty vs VAT
When a developer sells a brand-new property, they are typically VAT-registered. In this case:
- No transfer duty is payable
- VAT (15%) is included in the purchase price (or added on top, depending on the deal structure)
- The buyer still pays transfer attorney fees
Always ask your attorney whether the seller is VAT-registered before assuming you will pay transfer duty.
If a developer is advertising "no transfer duty," confirm whether they are absorbing it as a subsidy or whether VAT applies instead. They are not the same thing, and the total cost to you may differ.
What about attorney fees?
Transfer duty is just one part of what you pay upfront. Your transfer attorney will also charge conveyancing fees based on the purchase price. These are regulated by the Law Society and scale with the property value — typically between R6,000 and R22,000 on a property priced between R1M and R3M.
Use the Zettl buyer tools to see a full breakdown of your upfront costs — transfer duty, attorney fees, bond registration, and deposit — all calculated at once from your purchase price.
When do you pay?
Transfer duty must be paid to SARS within 6 months of the date of the sale agreement. In practice, your transfer attorney handles this on your behalf as part of the transfer process, using the funds you provide at registration.
Failure to pay within 6 months results in interest charged at the standard late payment rate.
Frequently asked questions
What is transfer duty in South Africa?
Transfer duty is a tax paid to SARS when buying property from a private individual. It uses a sliding scale: properties under R1,210,000 are fully exempt. Above that, rates range from 3% to 13% depending on the price band. New builds from VAT-registered developers attract VAT instead.
Who pays transfer duty — the buyer or the seller?
The buyer pays transfer duty, not the seller. Your transfer attorney collects the funds and pays SARS on your behalf during the transfer process. Payment must be made within 6 months of the sale agreement date.
What is the 2026 transfer duty threshold in South Africa?
The exemption threshold is R1,210,000. Properties purchased at or below this price attract zero transfer duty. This threshold increased from R1,100,000 with effect from 1 April 2025 and is unchanged for the 2026/27 tax year.
How much transfer duty on a R2 million property?
Transfer duty on a R2 million property is R33,786 under the current 2026 rates. This is R13,614 on the Band 2 portion at 3%, plus R20,172 on the Band 3 portion at 6%.
Do first-time buyers pay transfer duty?
First-time buyers purchasing below R1,210,000 pay zero transfer duty. Above this threshold, all buyers — including first-time buyers — pay transfer duty on the portion exceeding R1.21M. South Africa does not offer an additional first-time buyer exemption above this threshold.
What is the difference between transfer duty and VAT on property?
Transfer duty applies when buying from a private individual (not a VAT vendor). VAT (15%) applies when buying from a VAT-registered seller, typically a developer. You pay one or the other, never both. Confirm with your attorney which applies before signing an offer to purchase.
Key takeaways
- The 2026 exemption threshold is R1,210,000 — properties at or below this price attract zero transfer duty
- This threshold increased from R1,100,000 in April 2025 — older guides showing R1.1M are out of date
- Transfer duty uses a sliding scale: only the amount above each band threshold is taxed at that band's rate
- New builds from VAT-registered developers attract VAT (15%) instead of transfer duty
- Your transfer attorney pays SARS on your behalf from funds you provide at registration
- Total upfront costs also include attorney fees and bond registration — always calculate the full picture