“You Need To Know This”: South African Man Shares Why His Friend Pays More Property Taxes

• A property expert shared how his friend discovered he was being charged higher rates and taxes for owning more than one residential property
• The friend received a shock bill after councils started backdating charges, reducing his property rebate from R300,000 to just R15,000
• South African property owners are now questioning whether it's better to buy additional properties under company names

A South African property expert has left homeowners checking their municipal bills after sharing his friend's shocking discovery about higher property taxes.

Content creator @thepropertydealmaker posted a video in late July explaining how his friend got hit with unexpected charges for owning multiple properties under his personal name.

The property dealmaker, Aslam Du Toit, shared his friend's experience after receiving a call asking about property ownership. His friend had discovered that councils were charging people who own more than one property in their personal name higher amounts on rates and taxes, with some charges being backdated to January 2025.

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According to the video, the friend received a municipal statement showing an AD Section 15 of MPRA adjustment, which affected his property rebate. Normally, councils give property owners a rebate on the first R300,000 of their property's market value before calculating rates and taxes.

However, the friend discovered that while his first property still received the full R300,000 threshold rebate, his second property only qualified for a R15,000 rebate. This meant he was paying significantly more in rates and taxes on the second property's full value.

The City of Johannesburg statement explained that residential property owners who own more than one residential property get different treatment; the first property receives the R300,000 threshold rebate, but the second property only gets R15,000.

South Africans react to property tax changes

Property owners flooded the comments with concerns and questions about the new system.

@Tshepo_Lefakane asked:

"How does this work where it is a married couple? Will each of them get the R300k rebate? Making the rebate R600k?"

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@Adriaan_Pienaar shared his experience:

"I believe this also changed for companies, not just for properties in your personal name, we own in a company and got a similar rates adjustment😡"

@Heidi_De_Bruyn worried about the impact:

"I think the implication of this in the long run is that people will start selling if you own more than one property, creating a rental shortfall."

@Muzaffar_Darwood wanted clarity:

"Does this apply to you if you own more properties in 1 province/region? Or if you own 1 property in Gauteng and another, say, in the Eastern Cape?"

@Darox_Maroro_Darox revealed regional differences:

"In East London, our rebate is only R15 000 even if you have just one property."

@Reshna_Justin_Sahadeo confirmed the changes:

"Yep, it's true, since Jan this year. For the ones they missed, I now have a huge bill to settle. Raised a dispute, but don't think this will achieve anything."

Property taxes explained under Municipal Act

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According to the South African Government, the Local Government: Municipal Property Rates Act 6 of 2004 regulates how municipalities can impose rates on property. The Act aims to create transparent and fair systems for exemptions, reductions, and rebates through municipal rating policies, while providing fair valuation methods for properties.

The friend's situation shows how this Act allows councils to apply different rebate structures to multiple property owners. What made matters worse was that these charges were backdated, meaning property owners suddenly owed thousands of rands they weren't expecting to pay.

Watch the Facebook reel below:

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• Briefly News recently reported how SARS allegedly targeted a well-known businessman for over R1.7 million in unpaid taxes, but the public's reaction to the tax authority's demands was completely unexpected.
• A woman's monthly expense breakdown on her R16,000 salary left South Africans feeling stressed when they saw exactly where every rand was going and how quickly it disappeared.
• A digital nomad family living in Cape Town shared their monthly expenses that had locals questioning everything they thought they knew about the cost of living in the Mother City.

Source: Briefly News