This relief will apply to disposals to resident and non-resident transferees alike.
The capital gains tax roll-over relief (and associated STC and transfer duty relief) provisions relating to the transfer of a residence from a company, close corporation or trust to a natural person are to be extended to holiday homes, effective back to the introduction of the provision on October 1 2010. In the recently released Draft Taxation Laws Amendment Bill National Treasury had consented to the extension of the relief, facilitating owners of holiday homes the opportunity to rationalise and simplify their property holding structures. The extension of the relief to holiday homes means that, provided the home in question was mainly used for domestic purposes during the period 10 February 2009 to date of disposal, the transfer of such property will qualify for the extended relief. This relief will effectively apply to disposals to resident and non-resident transferees alike. Certain other amendments have also been proposed to the residence transfer provisions, some to alleviate practical difficulties and others to correct certain errors. The residence transfer relief is available for disposals made until December 31 2012. The early take up of the relief is encouraged. This may seem a long way off, but people should be urged to commence the process as soon as possible in order to avoid a last minute rush.
*Bernard Sacks is a tax partner at global audit, tax and advisory firm Mazars.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.