SARS Notification



Mr Trevor Manuel mentioned in his Budget Speech in February 2003 that certain property dealers are making increasing use of nominee purchases in order to avoid transfer duty or VAT upon resale. In these transactions, a dealer acquires fixed property on behalf of an "unnamed nominee." The dealer then adds the name when a suitable buyer is found on resale, thereby effectively hiding one taxable transaction. Artificial transactions of this kind will be disallowed. Section 16 of the Transfer Duty Act, 40 of 1949 states that the person acting on behalf of some other person shall disclose the name and address of the principle for whom he acts immediately upon acceptance by the auctioneer of his offer if the sale is by auction, and immediately upon the conclusion of the agreement of sale if the sale is otherwise than by auction. 'Immediately' is deemed to mean 'the same day.' As from 1st September 2003 the Western Cape region will be applying section 16 as it is written in the Transfer Duty Act, 40 of 1949. This will be applied to all contracts signed on or after 1 September 2003. Cheryl Rodney Team Leader Transfer Duty SARS