I believe that the various revenue officers are acting ultra vires and/or unconstitutionally for the following reasons:-
1. SARS is acting ultra vires - There is no provision in the Transfer Duty Act which entitles the revenue authorities to withhold transfer duty receipts or exemptions because the tax affairs of one of the parties are not in order.
2. Privacy of the tax payer - Requiring conveyancers to obtain the parties' income tax numbers is an invasion of the privacy provisions of our Constitution. A citizen's tax affairs are a private matter between that person and SARS and I have often had clients complain that their tax affairs are none of my business.
3. Transfer duty is a tax which becomes payable because there is an acquisition of rights in immovable property by one party from another. Income tax and/or VAT status of one party to the transaction has absolutely nothing to do with the other party. The withholding of transfer duty receipt or exemption because one party's tax affairs are not in order then has a detrimental effect on the other party to the transaction.
4. The attorneys privilege - If a tax payer is engaged in a dispute with SARS over income tax and/or VAT, and the transfer attorneys are his or her attorneys in the dispute, SARS then forces the attorneys to act as SARS' police and thus possibly against the interests of their own client.
Surely with the resources at the disposal of SARS coupled with the parties'[B1] information - full names and identity numbers, they can do their own police work? This is after all the 21st century and SARS do have computers.
I'm waiting for the day when I get a client with the backbone and the funds to take SARS to the constitutional court!
Liability of a usufructuary
De Rebus
Two sons were the bare dominium owners of a flat in which the lifelong usufruct had defaulted on arrear levies and disappeared. The body corporate sought advice on who it should sue, as the two sons disputed liability on the basis of the judgment in Ex Parte Standard Bank Ltd: In Re Estate Rodger 1963 (3) SA 683 (SR).
Management r 31(5) read with s 37(1) and (2) of the Sectional Titles Act 95 of 1986 (the Act) stipulates that:
'An owner shall be liable for and pay all legal costs, including costs as between attorney and client, collection commission, expenses and charges incurred by the body corporate in obtaining the recovery of arrear levies, or any other arrear amounts due and owing by such owner to the body corporate, or in enforcing compliance with these rules, the conduct rules or the Act' (my emphasis).
The definition of "owner", in terms of the Sectional Titles Act 95 of 1986, does not include only the person registered as owner but also the person registered as holder of a sectional title unit, such as a usufructuary. In Ex Parte Standard Bank Ltd: In Re Estate Rodger 1963 (3) SA 683 (SR), the registered usufruct was held liable for the rates and taxes of a full title property despite the applicable legislation providing for the 'owner' to be held liable.
The writer submits that the above judgement is correct with the usufruct enjoying the use and fruits of the property and should be applied to sectional title property as the current situation is frustrating for bodies corporate who battle to collect outstanding levies.
Bryanston idles without power
Business Day - South Africa
New property developments have all but ground to a halt in the Bryanston area because there is not enough electrical power to support them.
With a two-year waiting period for more services, property pundits say, Johannesburg's City Power department has not done enough to meet the growing power needs of the area.
David Green, MD of Pace Property Group, says retail and office developments have "literally ground to a halt" in Bryanston as a result.
"Unfortunately there is no solution in sight as it appears it will take more than two years to rectify the power deficiencies," says Green.
Durban housing 'needs miracle'
Cape Town - It will "require a miracle" if the eThekwini municipality - which embraces Durban and its surrounding areas - is to meet its "far-fetched" target of eradicating Durban's housing backlog by 2010.
This is according to the council's housing committee chairperson, S'bu Gumede. His comments were reported in the SA Local Government Briefing released by the Cape Town-based SA Local Government Research Centre headed by Alderman Clive Keegan.
The centre reported that Gumede told a recent committee meeting that the municipality's housing department would need to build twice as many houses every year if it planned to meet its goal within the next seven years.
Government gives clarity on short term leases and stamp duty
The proposed exemption of stamp duty on leases of less than five years in respect of leases signed on or after a certain date this year announced by the Minister of Finance in the budget in February, applies to residential, commercial and retail leases.
Clarity on the exemption and other relative matters has been issued in the form of amendments to the Stamp Duty Act, as contained in the Taxation Laws Amendment Bill published by National Treasury on 28 February.
Warmback notes that although the Bill refers to an April 1 commencement date, this has now been overtaken by verbal advice from SARS indicating the start date is likely to be June 1 2007.
While short term tenants will be pleased with the proposed exemption, Warmback advises careful examination of the other changes and proper assessment of the full impact of the new provisions. "The five year exemption will not apply to leases where the total aggregate of the lease period exceeds five years after accounting for the renewals and extensions. If, for example, a lease of three years has a right of renewal for three years, the duty applies because the aggregate period exceeds five years."
Get R100 000 cash back on your bond
Buy a flat for R600 000 and get R100 000 back on registration.
A property investment company is offering R100 000 cash back to clients that purchase units in a new development. The company, called Property Portfolio Investments (PPI), says it has negotiated a "discount" of R100 000 on flats sold in a yet-to-be-built development called Green Acre Terraces in the Western Cape. This discount will be paid out upon registration of the property.
PPI says that all of the big banks have approved the value of the units at R600 000 each. Thus investors who apply for finance for this amount hand over R500 000 to the developer for the unit, and pocket R100 000 themselves.
One of PPI's agents explained to Moneyweb that his company has a relationship with respected developers in the Western Cape. He says that developers are prepared to offer a substantial discount on the price of their units, provided PPI sells a specified number in a pre-determined time period