Budget 2025: what agents need to know: [an extract from an Article in: PROPERTY PROFESSIONAL – 17 March 2025]
Last week Finance Minister Enoch Godongwana presented his 2025 Budget after a much-publicised delay. We’re giving you a snapshot of the good and the bad, but before we delve in, it is important to note that this budget, while presented, has not been approved. The next few weeks will likely deliver a few surprises as the various departments jockey for amendments.
The good news
- Transfer duty: The threshold has been increased by 10% from R1.1 million to R1.21 million….
- No adjustments to certain taxes: “There have been no adjustments to capital gains tax, dividend tax, donations tax or estate duties..
The bad news
- Personal income tax: “It is disappointing that personal income tax brackets were not fully adjusted for inflation. Without a proper inflation-linked tax bracket adjustment, middle- and higher-income earners will pay more in real terms due to ‘bracket creep…
- VAT increase: After weeks of debating a proposed 2% VAT increase, the Minister’s budget now calls for a 0.5% increase this year, and a further 0.5% increase in 2026/27, instead of the hotly debated 2% that was originally included
How could the VAT hike impact real estate?
… While it may drive up costs for developers, buyers, and renters in the short term, it could also create a shift in market dynamics that benefits certain segments. For example, reduced demand for new developments might stimulate increased activity in the secondary market, particularly in the affordable housing segment. This could lead to a rise in the value of pre-owned properties, potentially offering great opportunities for existing homeowners and investors.
Although higher VAT may temporarily slow the pace of new developments, it also encourages innovative solutions within the industry. Developers and stakeholders might explore cost-saving measures and alternative building methods to maintain affordability and attract buyers…
…The real problem with transfer duty: “While we note that only the transfer duty threshold has been increased, the bigger question is why is transfer duty so high to begin with?…
What happens next?
There is still a long road ahead before Budget 2025 can be approved. It will be reviewed in Parliament, and there will be committee deliberations and coalition negotiations before a final Parliamentary vote. Only if the majority approves will it be implemented.
The Original, Full Article can be Viewed here: → Budget 2025: what agents need to know – Property Professional
Transfer Duty Table for 2026 – ‘proposed’ with effect from 1 April 2025
| R 1 – R 1 210 000 | No Trans Duty | ||
| R 1 210 001 – R 1 663 800 | R 453.799 | @ 3% | R 13 613.97 |
| R 1 663 801 – R 2 329 300 | R 665.499 | @ 6% | R 39 929.94 |
| R 2 329 301 – R 2 994 800 | R 665.499 | @ 8% | R 53 239.92 |
| R 2 994 801 – R 13 310 000 | R 10 315.199 | @ 11% | R 1 134 671.89 |
| R 13 310 000 and above | R ?? | @ 13% | R ??? |
SARS Link: here: → Transfer Duty | South African Revenue Service