E-stamping of property leases to become standard practice

Landlords and letting agents should prepare for a further change in the way that property leases are stamped, according to Vivien Marks, regional general manager of the Institute of Estate Agents Western Cape.

The South African Revenue Service introduced online "e-stamping" earlier this year and, according to a recent SARS presentation to IEA members, it will become the normal as from February 2006. Thereafter, revenue stamps will no longer be available at post offices, and landlords and letting agents who wish to stamp documents manually will have to take them to their local SARS office.

"Online payment appears to be an easy and effective way of dealing with stamp duty," says Marks, herself a former letting agent and currently a member of the Rental Housing Tribunal. "We were impressed with the features provided by SARS on their website, including a calculator to work out the exact amount of duty payable."

Marks points out that this is the second major change in stamp duty on leases in the past year. In January 2005, stamp duty was doubled and in addition to being payable on the rental value of the lease, it also became payable on any other amounts, such as electricity and water, for which the tenant agrees to reimburse the landlord. As a result, many leases now have to be re-stamped annually to provide for those additional amounts.

Marks notes that many people believe that it is the tenant's responsibility to pay stamp duty on a lease. However, it is actually the landlord's, but it is common practice for the lease to provide for the tenant to reimburse him. A lease must be stamped within thirty days of being signed.

The IEA, a private organisation which provides estate agents with professional support, recommends that letting agencies set themselves up for e-stamping without delay.

The SARS website address for e-stamping is: www.sarsefiling.co.za.
Loading comments
More news articles
news
Guidelines to securing a home loan
29 May 2018
Many young South Africans are working hard to achieve their dream of purchasing their first home. However, the process can be challenging due to the daunting application process, which can take up to 2 years and is often enough to discourage prospective buyers.
read more
news
Things you should consider before upgrading to a new home
23 Apr 2018
The thing about the property ladder is that at some point in our lives we all have reason to want to climb a rung or two higher. Sometimes, it’s because we’ve outgrown our previous dream home, or because we want to be in a better neighbourhood that’s closer to work or to schools. Sometimes it’s because our circumstances have changed, and we’re taking care of elderly parents or relatives. Sometimes, it’s just because we want a property that reflects the financial status our hard work has won.
read more