However, where an entity was registered for value-added tax (VAT) because the property was used as a hotel or constituted commercial property, no transfer duty would be payable as VAT would be paid when the property was sold.

Deloitte & Touche corporate tax partner Russell Eastaugh said people who owned property through companies, close corporations or trusts faced a 'double-edged sword'.

He said that when these people sold their property they would be subject to capital gains tax on any subsequent gain which they made.

Business Day