Buy Property in Own Name or Through Legal Holding Entity If you’re looking to buy a house in South Africa, it’s worth knowing about the Land Holdings Bill. Generally overseas property buyers who retain their non-resident status can remit and repatriate funds freely overseas, this includes capital gains made after the deduction of taxes due. Your email address will not be published. 10 tips for non-residents buying property in South Africa 1. Buy Property Non-residents must transfer 50% of the purchase price or balance of purchase price, via the Reserve Bank, from their own foreign bank to a South African bank account. Foreigner's guide to buying property in South Africa. There are no legal restrictions on foreigners buying property in South Africa, although non-residents looking to invest may have to pay as much as 50% of the purchase price up-front as a deposit. Property to Rent Are there any restrictions on non-residents buying property in South Africa? One thing you should be aware of is that non-residents buying property in South Africa currently may borrow a maximum of 50 per cent of the purchase price in the country. Inspections, About Us Getting on the property ladder can be daunting experience, especially for a first time home buyer. Non-residents buying property in South Africa has become a very popular option since the rand value compared to other currencies makes for great investment opportunities and also because it’s considered the business gateway into Africa. Commercial Property, List your Property In SA all contracts to buy property need to be in writing. South African Property Taxes, Fees and Charges  2. On the sale of a property, can non-residents get their money out of South Africa? From 1 September 2007, a purchaser of immovable property (which has been disposed of in excess of R2 million) is obliged to withhold the amounts set out below from the purchase price payable and pay the tax to SARS, if the seller of the property is not resident in South Africa: 7.5% … These costs relate to the costs incurred in raising mortgage finance. In fact it is a good option to have the services of a lawyer to assist throughout the entire conveyance and purchase process to check any contracts and to carry out title and land registry searches and checks. Rental income is normally taxable in South Africa. Non-resident owners of South African property have all the normal rights of ownership including the right to recover rental income from lessees. However, should the prospective purchaser intend residing in the property for any length of time, he or she will need to comply with the requirements of the Immigration Act and either have a valid permit to temporarily remain in the country or be in possession of a permanent residency permit. In South Africa, properties are normally purchased through an estate agent, who should be registered with the Estate Agents Advisory Board. READ MORE: Purchase of property by Foreigners in South Africa. Although there is a lengthy list of countries who do not need visas for visits of less than 90 days, foreign nationals from visa-restricted countries will have to apply for the relevant visa. Buying Property in SA as a Resident or Non-Resident (PART 1 OF A 4 PART SERIES) South Africa follows a system of land registration where every piece of land is reflected on a diagram and ownership recorded in one of the regionally located Deeds Registries where documents are available for public viewing. The answer to this is a resounding NO, save for a prohibition on illegal aliens owning immovable property in South Africa . However, mortgage options top out for non-resident buyers at just 50% of the property purchase price. Are there additional costs to the purchase price? Foreigners can invest in property in South Africa as individuals, through joint ownership or by acquiring shares in an entity that owns property. Property may also be held through share ownership in companies, holding membership in close corporations or as a beneficiary in a trust. Both documents are legally binding and it is advisable to consult legal advice before signing either of the documents. Non-Residents Buying Property in South Africa . Jan 03, 2019 | Persons who are not South African citizens (or residents) may purchase immovable property in South Africa. Foreign / non-resident individual. Get the best of Private Property's latest news and advice delivered straight to your inbox each week. Your email address will not be published. A close corporation is a type of company that is flexible and cheaper to form and administer than a normal incorporated company. This tax is called a Withholding Tax (WHT). South Africa’s banking system is dependable, established and highly advanced. To ensure repatriation, all foreign funds remitted to South Africa must be declared and documented, and the property must be endorsed ´non-resident´. ● The profit made on the sale of the property may be taken out of South Africa Non-resident owners of South African property have all the normal rights of ownership including the right to recover rental income from lessees. The transfer of funds through any registered South African bank is secure and guaranteed. There are, however, procedures and requirements which must be complied with in certain circumstances, such as the local registration of entities registered outside of South Africa where they purchase property in South Africa, and the appointment of a South African resident public officer for a local company whose shares are owned by a non-resident. All persons who are not residents (non-residents) are still subject to tax in South Africa on their income from a source within or deemed to be within South Africa. By Elistea Vrey, Heyns and Partners Inc. With a beautiful coastal line, sunny skies and an advantageous exchange rate, investing in property in South Africa is a beneficial opportunity. Some non-residents prefer buying property through a legal holding entity for taxation, management and asset protection reasons. Finally, a non-resident can purchase South African property over the internet without entering the country. South African Property Ownership Methods There is nothing to prohibit a non resident from buying property in SA personally or through an entity subject to certain requirements. The program also gives home buyers visa-free travel to more than 100 countries, including the Schengen Zone (25 EU countries), Canada, the UK, Hong Kong, Singapore, etc., as well as making it easier to gain a residency permit to Monaco, Switzerland, Andorra, the UK, Bermuda, Cayman Islands, Bahamas and other Caribbean countries. A non-resident will need to submit it to the South African Reserve Bank if and when the property is sold and the owner wishes to return the funds to the foreign country. Private Property offers a an easy-to-use platform for buyers to browse through South Africa’s top deals and homes on sale. Non-residents who are purchasing property in the name of a company or other legal entity rather than in their own... 3. Most non-resident property buyers choose the leasehold method of property ownership as this method of transfer is much more flexible than the other methods. South Africa’s immigration system is regulated by the Immigration Act of 2002 (as amended) and its associated regulations. This procedure does not apply where the shares/members interest and loans are acquired in a property-owned company/close corporation where no change in ownership is recorded. Bond Finance Can non-residents lease their properties out to others? What forms of ownership are available and which is the best? Non-residents can own property partially or wholly, in their own names or through ownership of an interest in one or other forms of legal entity. Privacy, Many fail to consider ALL the costs involved when…, All you need to know about Kitchen Flooring, What You Should Know Before Becoming A Landlord. Buying Property as a Non South African IMMIGRATION The South African Immigration Act The South African Immigration Amendment Act number 19 of 2004 and the new immigration Regulations came into operation in the 1st of July 2005 and herald in different sets of criteria for temporary and permanent residence in South Africa.