M.C. VAN DER BERG INC.

14/09/2026

04/09/2026

𝗦𝗔𝗟𝗘 𝗔𝗦 𝗔 𝗚𝗢𝗜𝗡𝗚 𝗖𝗢𝗡𝗖𝗘𝗥𝗡 𝗔𝗡𝗗 𝗩𝗔𝗧 𝗥𝗘𝗤𝗨𝗜𝗥𝗘𝗠𝗘𝗡𝗧𝗦

In property transactions either Transfer Duty or VAT is payable. If the Seller is a VAT vendor the question is whether VAT will be payable at 15% or at 0%.

𝗙𝗶𝗿𝘀𝘁𝗹𝘆, it must be ascertained whether the vendor sells the property in furtherance of its enterprise. If the vendor is a dentist whose practice is VAT registered and he sells his residence (a property not used or applied in the course of the business), the transaction will not attract VAT, and the purchaser will pay transfer duty.

𝗦𝗲𝗰𝗼𝗻𝗱𝗹𝘆, 𝘁𝗵𝗲 𝗿𝗲𝗾𝘂𝗶𝗿𝗲𝗺𝗲𝗻𝘁𝘀 for the sale as a going concern in terms of Section 11(1)(e) of the Transfer duty Act must be met:

1. Both the seller and purchaser must be registered 𝗩𝗔𝗧 𝘃𝗲𝗻𝗱𝗼𝗿𝘀.
2. The enterprise supplied must be capable of separate operation.
3. Both the seller and purchaser must agree 𝗶𝗻 𝘄𝗿𝗶𝘁𝗶𝗻𝗴 that the business is
disposed of as a going concern.
4. Both the seller and purchaser must agree 𝗶𝗻 𝘄𝗿𝗶𝘁𝗶𝗻𝗴 that the business is an income-earning activity on the date of transfer.
5. That the assets necessary to continue its income earning activity will be disposed of to the purchaser.
6. That the agreement concluded specify that the consideration for the supply of a going concern includes VAT at 0%.

𝗘𝘅𝗮𝗺𝗽𝗹𝗲𝘀:

1. Sale of a commercial property, dentist practice, including the equipment and where the purchaser will continue using the property as a dental practice. The business operations continue undisrupted before and after registration.
2. Sale of a farm including farm implements and livestock and the farming will continue after date of registration.

𝗜𝗺𝗽𝗼𝗿𝘁𝗮𝗻𝘁:

SARS will not consider zero rating if the VAT returns are not submitted and up to date.

The agreement of sale should contain a provision that if SARS declines the Zero-rated transaction, the standard 15% VAT rate will be payable by the purchaser.

𝗥𝗲𝘀𝗶𝗱𝗲𝗻𝘁𝗶𝗮𝗹 𝗽𝗿𝗼𝗽𝗲𝗿𝘁𝘆 𝘀𝗮𝗹𝗲 𝗮𝘀 𝗮 𝗴𝗼𝗶𝗻𝗴 𝗰𝗼𝗻𝗰𝗲𝗿𝗻:

Residential property leased for residential purposes is exempt of VAT (irrespective if the property is registered in a company’s name). Therefore, the transaction is not subject to VAT.

28/08/2026