Who Pays The Transfer Fees When Selling a House in South Africa?

Under the Transfer Duty Act 40 of 1949, transfer duty is a tax levied on the person acquiring the property — the buyer (the “transferee”) — and is paid to SARS. By long-standing conveyancing convention in South Africa, however, the seller pays the transfer duty, the conveyancing attorney’s fees for attending to the transfer, the deeds office registration fees, the rates clearance certificate, and any required compliance certificates, while the buyer pays the bond registration costs on any new bond and any bond cancellation costs on the seller’s existing bond. The default split is not law — it is industry convention, and the parties are free to reallocate it in the offer to purchase, which is exactly where most South African property deals are actually negotiated.

Who Legally Owes Transfer Duty — the Buyer, Not the Seller

Transfer duty is a tax imposed under the Transfer Duty Act 40 of 1949 and collected by SARS. The legal incidence of the duty falls on the transferee — the person acquiring the property — regardless of how the parties label the cost on the statement of account. SARS calculates the duty on the greater of the purchase price or the fair market value of the property, on the bracket schedule it publishes. If SARS believes the declared price is below market value, it can reassess against fair market value, which is why the figures on the deed of sale and the municipal valuation tend to converge.

The legal position is separate from the practical reality. Very few buyers write a cheque directly to SARS on registration day. The conveyancing attorney settles the duty from the purchase proceeds held in the firm’s trust account at registration, and the seller is then asked to refund the duty (and the rest of the seller’s transfer-cost basket) out of the gross proceeds. From the buyer’s perspective, the duty appears as a single line on the statement of account. From the seller’s perspective, it is one of several deductions that reduce the net amount that lands in the bank on registration day.

The Standard “Transfer Costs” Bundle Paid by the Seller

By conveyancing convention, the seller carries the following basket of costs on the transfer of a residential property. The categories are not exhaustive of every disbursement a particular file will generate, but they cover the line items that appear on the standard statement of account in Gauteng and across the country.

• Transfer duty — calculated against the SARS bracket schedule for natural persons acquiring residential property. The current schedule applies from 1 April 2026 per the SARS rate page.
• Conveyancing attorney’s fees for the transfer — charged on the tariff prescribed under the Legal Practice Act 28 of 2014. The conveyancer attends to drafting the deed of transfer, lodging it at the deeds office, and attending to registration.
• Deeds office registration fees — a small fixed fee per lodgement, set by the deeds registry.
• Rates clearance certificate — obtained from the municipality confirming that all rates, taxes, and municipal charges are paid up to the date of registration.
• Compliance certificates — electrical (ECOC), beetle (where still required by the municipality), and plumbing (where applicable), obtained at the seller’s cost.
• FICA compliance and administrative costs — the conveyancer’s fee for verifying the parties’ identities and source of funds under the Financial Intelligence Centre Act 38 of 2001.
• Postage and petties — incidental disbursements. Electronic lodgement has largely replaced physical postage, but small sundry costs remain.

What the Buyer Pays Separately

The buyer’s side of the ledger is split across two practice areas: the bond (where the buyer finances the purchase) and the transfer itself. The “transfer costs” basket on the seller’s side and the “bond costs” basket on the buyer’s side are normally quoted as separate figures.

• Bond registration costs — the conveyancer (or the bond-registration attorney appointed by the bank) charges a separate fee on the same prescribed tariff under the Legal Practice Act to register the new bond over the property.
• Bond cancellation costs — the existing bondholder’s attorney attends to cancellation of the seller’s existing bond at registration. The buyer typically reimburses this cost in the conventional split. Some deeds offices no longer require a formal cancellation where the bond is fully settled, but the cost line is still normally quoted on the estimate.
• Bank charges — initiation and valuation fees are charged by the bank, not the conveyancer, and sit outside the “transfer costs” basket.

How the Numbers Are Worked: A R2,500,000 Sale Example

The current SARS bracket schedule for natural persons acquiring residential property, applicable from 1 April 2026, is structured as follows:

Value of the property (R)	Rate of transfer duty
1 – 1,210,000	0%
1,210,001 – 1,663,800	3% of the value above R1,210,000
1,663,801 – 2,329,300	R13,614 + 6% of the value above R1,663,800
2,329,301 – 2,994,800	R53,544 + 8% of the value above R2,329,300
2,994,801 – 13,310,000	R106,784 + 11% of the value above R2,994,800
13,310,001 and above	R1,241,456 + 13% of the value above R13,310,000

On a R2,500,000 sale by a natural person, the duty falls in the fourth bracket: R53,544 + 8% of (R2,500,000 − R2,329,300) = R53,544 + 8% × R170,700 = R53,544 + R13,656 = R67,200 in transfer duty. Adding the prescribed conveyancing tariff on R2.5 million (roughly R22,000–R25,000 on the prescribed sliding scale), deeds office fees, the rates clearance certificate, electrical and any required beetle and plumbing compliance certificates, and FICA and administrative disbursements, the seller’s full transfer-cost basket on this transaction lands in the region of R95,000–R115,000 before bond cancellation adjustments on the buyer’s side.

Cost line	Approximate amount	Paid by (default convention)
Transfer duty on R2,500,000 (calculated above)	R67,200	Seller (owed by buyer, funded through the conveyancer at registration)
Conveyancing transfer tariff	R22,000 – R25,000	Seller
Deeds office registration fees	R1,500 – R2,500	Seller
Rates clearance certificate	R500 – R2,000 (municipality-dependent)	Seller
Compliance certificates (electrical + where applicable: beetle, plumbing)	R2,500 – R6,000	Seller
FICA, postage, petties	R1,500 – R3,000	Seller
Seller’s total transfer-cost basket	~R95,000 – R115,000	Seller
Bond registration attorney’s fee on R2,500,000 bond	R25,000 – R30,000	Buyer
Bond cancellation attorney’s fee	R8,000 – R12,000	Buyer

Indicative figures only — final amounts depend on the property value, the prescribed tariff band, the municipality, and the bank’s nominated attorneys. Confirm the current SARS bracket schedule on sars.gov.za before signing.

Where the Convention Comes From and Why It Persists

The seller-pays transfer costs split is not written into any statute. It evolved in conveyancing practice as the practical arrangement that lets the seller’s attorney act for both sides and recover all costs from the purchase price at registration. A single firm usually attends to the transfer, the bond registration, and the bond cancellation, which keeps the registration day efficient and reduces the risk of a mismatch between the parties’ attorneys on lodgement paperwork.

The arrangement is also commercially logical for sellers. The proceeds at registration fund the transfer duty, so requiring the buyer to separately fund SARS would create a cash-flow gap on registration day — the buyer would need to pay duty over and above the purchase price, and the seller would still expect full settlement. Combining the duty with the price and recovering it from the proceeds is a cleaner transaction, and the convention reflects that.

The Offer to Purchase Is Where the Split Gets Negotiated

The standard “Schedule A” or “Annexure” to most residential offers contains clauses that either confirm the conventional split or reallocate it. Three practical patterns are common in the South African market:

1. Conventional split. The seller pays the transfer-cost basket as defined above; the buyer pays bond registration and bond cancellation. This is the default in most standard sales.
2. Buyer asks the seller to “pay transfer costs.” In a slower market, a buyer may offer the full asking price and ask the seller to gross up for the duty, the conveyancing fees, the compliance certificates, and sometimes the buyer’s bond costs as well. The seller accepts or declines as part of the price negotiation.
3. Hot-market seller refuses to gross up. In a competitive market, a seller can refuse to gross up and require the buyer to fund the duty, the conveyancing fees, and the buyer’s bond costs themselves. The buyer either accepts or walks.

Once signed at the offer stage, the schedule binds both parties. Subsequent re-negotiation requires a fresh deed of sale or a signed addendum, and a buyer who has already incurred bond costs by the time the offer is renegotiated has limited leverage. Getting the cost split right in the offer itself is the cleanest way to avoid a registration-day dispute.

Practical Risks When the Split Goes Wrong

Three friction points recur on registration day when the offer to purchase is silent or ambiguous on the cost split.

• Compliance certificates. If the seller and buyer have not agreed who pays the electrical, beetle, and plumbing certificates, the convention still treats these as seller costs but the buyer may resist on registration day — particularly if the certificate reveals a defect that requires repair before transfer.
• Transfer duty not paid. If the transfer duty is not paid to SARS by registration, the deeds office will not register the transfer. The conveyancer normally pays SARS from the trust account on the day of registration, but if the duty is underfunded because the cost estimate was wrong, the transaction is delayed until the shortfall is made good.
• Net proceeds miscalculated. The conveyancer cannot release the net proceeds to the seller until every cost line (including bond cancellation) is settled from the purchase price. The seller’s expected “in the bank” amount depends on accurate pre-registration cost estimates, and a line item that slipped through the estimate at offer stage reduces the net proceeds without warning.

VAT Vendors: A Different Regime Entirely

Where the seller is a VAT-registered vendor and the property forms part of an enterprise’s taxable supplies, the transaction is zero-rated for VAT and no transfer duty is payable. Output VAT at 15% is accounted for on the sale instead. This regime applies to property developers and enterprises selling trading-stock property — typically new-build units sold off-plan, commercial property held as trading stock, or property developed for resale.

The ordinary residential seller disposing of a home is not caught by this regime. The conveyancer will ask the seller to confirm VAT vendor status at the FICA and agreement-of-sale phase, and a seller who incorrectly claims zero-rating on a residential sale risks a SARS reassessment for the transfer duty that should have been paid, plus interest and penalties. If you are unsure whether your transaction falls under the VAT regime, the question belongs to your conveyancer and your tax adviser before the offer is signed.

Which Deeds Registry Applies to Your Property

Transfer duty is a national tax — the same SARS bracket table applies in every province, so the location that matters for the duty itself is the country, not the city. The location that does matter is the deeds registry in which the property is registered, because the registration turnaround and the practical day-of-registration logistics are registry-specific. Properties in Gauteng register at the Johannesburg Deeds Registry (or the Pretoria Deeds Registry for matters falling in the former Transvaal north); properties in the Western Cape register at the Cape Town Deeds Registry; properties in KwaZulu-Natal register at the Pietermaritzburg Deeds Registry.

Frequently Asked Questions

Who legally pays transfer duty on a property sale in South Africa?

Transfer duty is legally owed by the transferee — the person acquiring the property — under the Transfer Duty Act 40 of 1949, and is paid to SARS. In practice the duty is almost always settled through the conveyancing attorney from the purchase proceeds and recovered from the seller under the standard conveyancing convention; the parties can reallocate who actually funds the duty by agreement in the offer to purchase.

Is it law that the seller pays the transfer fees, or just convention?

It is industry convention, not law. The Transfer Duty Act puts the duty on the buyer, and there is no statute that assigns the conveyancing tariff, deeds office fees, or compliance certificates to either side. The default split — seller pays transfer duty, conveyancing fees, deeds office fees, rates clearance, and compliance certificates; buyer pays bond registration and bond cancellation — is what the conveyancing profession applies where the offer to purchase is silent, but the parties are free to vary it in writing.

What does “transfer costs” include on a R2.5 million house sale?

On a R2,500,000 sale paid by a natural person, transfer duty is R67,200 under the SARS bracket schedule in force from 1 April 2026 (R53,544 base at the R2,329,300 threshold plus 8% on the R170,700 above it). Add the conveyancing tariff on R2.5m (roughly R22,000–R25,000), deeds office fees, the rates clearance certificate, electrical and any required beetle and plumbing compliance certificates, and FICA and administrative disbursements, and the seller’s total transfer-cost basket lands in the region of R95,000–R115,000. The buyer separately budgets roughly R25,000–R30,000 for bond registration and R8,000–R12,000 for bond cancellation on the same transaction.

Can a buyer ask the seller to pay all the transfer costs?

Yes. It is common in slower markets for a buyer to offer the full asking price and ask the seller to gross up for transfer duty, conveyancing fees, and the buyer’s bond registration and bond cancellation costs. The seller accepts or declines as part of the price negotiation. Once the offer to purchase is signed, the cost allocation in the schedule is binding and cannot be reallocated without an addendum signed by both parties.

Do sellers who are VAT-registered vendors pay transfer duty?

Generally no. Where the seller is a VAT-registered vendor and the property forms part of an enterprise’s taxable supplies (typical for developers and enterprises selling trading-stock property), the sale is zero-rated for VAT and output VAT at 15% is accounted for instead — no transfer duty is payable. This regime does not apply to the ordinary residential seller disposing of a home; the conveyancer will confirm VAT vendor status at the FICA stage and any incorrect answer risks a SARS reassessment.

When does the transfer duty have to be paid?

Transfer duty must be paid to SARS before the deeds office will register the transfer. The conveyancer normally pays SARS from the purchase proceeds held in the trust account on the day of registration; if the duty is not paid, registration cannot proceed and the transaction is delayed.

Whether you are selling and want a clear estimate of the transfer duty, conveyancing fees, and compliance certificates that will come off your proceeds, or buying and want to understand the cost lines that will be added to your bond, Burger Huyser Attorneys’ Notarial & Conveyancing team can give you a written quotation and walk you through the cost schedule before you sign the offer to purchase. The firm’s Bedfordview branch (45A Florence Avenue, Bedfordview, 011 201 7190) handles conveyancing matters across Gauteng and the wider Johannesburg–Randburg–Sandton–Pretoria corridor. Reach out for a transfer-cost estimate tied to the deeds registry where your property is registered.