"An Attorney near me" - Cape Town legal concierge
lawyer@capetownlawyer.co.za or WhatsApp

The property in a deceased estate can either be:

• Inherited in which case the transfer costs are the same as normal transfer costs except that:
  • there is no transfer duty payable (this sounds good, but there may be estate duty instead) and
  • there is an additional R1058 fee payable for the Section 42 certificate.
  Note that zero transfer duties is applicable irrespective of your relationship with the deceased. The transfer costs for inherited property are paid out of the deceased estate. Inherited property is either specified as such in the will or if there's no will inherited according to the Intestate Succession Act. If the estate experiences a "liquidity shortfall" and cannot afford the transfer costs the executor of the estate may approach the heirs to obtain permission to either sell assets in the estate to generate liiquidity or to request the heirs to supply the liquidity out of their own pockets (if this means that the property is sold by the estate instead of being inherited, then the rules for inherited property do not apply - see next bullet).
• Purchased by somebody out of the estate, instead of being inherited; in which case normal transfer costs (including transfer duty) are paid.

Once you've calculated the conveyancing costs, email lawyer@capetownlawyer.co.za and ask us to negotiate on your behalf and try find a lawyer who can beat the quote (we almost always can). We'll be happy to arrange a fee-free initial meeting with an estate lawyer to assist you with your deceased estate. To prep for the meeting you may want to not just be aware of conveyancing fees, but also use a tool to calculate potential estate duty liability on the inherited property.

Estate duty

Estate duty (also known as "inheritance tax") is payable to SARS on the net value of the estate above a threshold (R3.5m at the time of writing): 20% on the first R30 million and 25% on anything above that. In addition to the basic deduction of R3.5m, deductions are allowed for liabilities (hence the term "net value" or "dutiable value", property accruing to surviving spouses and bequests to public benefit organisations). Note that the calculator at the top of this page does not estimate the estate duty which might be applicable on the net value of the estate (which includes the value of property in the estate).

Section 42 Certificate costs

The Section 42 Certificate refers to a document issued by the Master of the High Court confirming that an executor has the authority to administer the estate of a deceased person. It helps facilitate the transfer of assets and ensures that the estate is distributed according to the will or intestacy laws. The cost of the section 42 certificate is R1024 (R890 plus VAT; correct at the time of writing).

Conveyancing fees to transfer attorney

The conveyancing fees payable to the transfer attorneys (conveyancers) are the same, whether or not the the property is sold for cash or inherited from the deceased estate. However, if the property is inherited from the deceased estate then the conveyancing fees are payable by the deceased estate, whilst if the deceased estate sells the property for a cash consideration, the purchaser must pay for the conveyancing fees (the same applies to the other transfer costs, as to who must pay).

Normal transfer costs for property worth R5m

Transfer costs when inheriting property from a deceased estate, worth R5m

How to transfer a property out of a deceased estate

The process of transferring the property from the deceased estate may only begin once the Master of the High Court has appointed an executor. The property cannot be transferred or sold without the Master issuing Letters of Executorship or Authority. The easiest process is to appoint an estate lawyer who is also a conveyancer, and thus can assist both with obtaining letters of executorship as well as do the conveyancing for the property transfer.

The executor in turn can appoint a conveyancing attorney who has the legal authority and know how to transfer the property. The conveyancer can either transfer the property to an heir, or sell the property. If the property is sold then the purchaser pays the transfer costs, whereas if the property is transferred to an heir who inherits it, the costs of the transfer are borne by the deceased estate.

Other property-related costs in a deceased estate

Transfer costs are not the only property-related cost which may be incurred by a deceased estate; other expenses are:

• Rates and Taxes
• Levies
• Insurance Premiums
• Maintenance costs & repair of the property
• Water, sewage and electricity bills
• Executor's fees, which are based on all assets including property assets

There are also other costs related to the sale of the property:

• Estate agents' commission
• Capital Gains Tax; taking into account the primary residence exclusion if the deceased used it as such (note that the annual exclusion of R50 000 for capital gains for individuals is increased to R440 000 during the year of one's death; this held at the time of writing, click here to see whether it has been changed by SARS)
• Appraiser fees (when property needs to be valued)
• Compliance certificates
• Maintenance costs & repair of the property
• Water, sewage and electricity bills

Property transfer when there's no will?

If there was no will then the Intestate Succession Act determines how and to whom the net estate, including immovable property, is distributed. The heirs will nominate an executor who, if accepted by the Master, will be responsible for managing and distributing the estate. The property will either be sold or inherited; with the transfer costs applicable being those described at the top of this page.

Valuation of inherited property

If the property is being inherited by a beneficiary (either through a Will or via intestate succession), there is no sale, no "purchase price," and no Offer to Purchase. The property simply transfers ownership from the deceased estate to the heir.

However, even without a sale or a purchase price, the property still has to be valued for the estate's administrative and tax purposes, including the calculation of conveyancing fees. Here is how that works when a property is inherited:

• Valuation for the Liquidation & Distribution (L&D) Account
  Even though money isn't changing hands for the property, the executor must list all of the deceased's assets and liabilities in the L&D account. The property must be assigned a fair market value as of the date of death. To determine this value, the executor will typically use:
  • The current Municipal Valuation (often the easiest and most accepted method for straightforward inheritances).
  • A Sworn Appraisal or estate agent valuation (if the Master of the High Court or SARS requests it, or if the municipal value is disputed).

While there is no purchase price and no Transfer Duty payable by the heir, the date-of-death valuation is still highly relevant for three reasons:

• Estate Duty: SARS uses this valuation to calculate the total net value of the estate. If the net estate exceeds R3.5 million, Estate Duty (typically 20%) is levied.
• Executor’s Fees: The executor is legally entitled to a fee (usually up to 3.5% + VAT) on the gross value of the estate's assets, which includes the value of the inherited property.
• Conveyancing fees, which are usually expressed as a function of the property's value.
• Capital Gains Tax (CGT) Base Cost: For the heir inheriting the property, this date-of-death valuation becomes their "base cost." If the heir decides to sell the property five years later, their Capital Gains Tax will be calculated based on the profit made above that specific date-of-death valuation, not what the deceased originally paid for it decades ago.

Capital gains tax (CGT) questions

• If you inherit property, what is the base cost to be used in the CGT calculation when you subsequently sell the property?
  • The base cost is the value of the property on the date you inherited it.

Rental property in a deceased estate

Rentals on a property in a deceased estate are subject to tax inside the estate until the date of finalisation. Any rental income after finalisation of the estate is taxed in the hands of the beneficiary of the proiperty; the executor of the estate should inform the beneficiary of the property on what rentals were received before finalisation and and had tax paid on them in the estate, and from when the rentals should be declared to SARS by the beneficiary. Click here to see details of how SARS expcect this to be handled.

Frequently asked questions

• In the case of the transfer of deceased property, are property transfer costs always paid out of the estate of the deceased?
  • No; it is only in the case of the property being inherited from the estate that the deceased estate is liable to pay the property transfer costs. If the property is sold by the estate for cash then the purchaser of the property is liable to pay the property transfer costs. Even when the property is inherited, it sometimes happens that the estate does not have sufficient cash to pay the property transfer costs, and the executor may agree with the heirs inheriting the property that they pay the transfer costs rather than the estate.

Complexities in buying a property from a deceased estate

The purchaser is often not involved in the estate, and does not know the circumstances around the estate wanting to sell the property. The executor would often only put up a property for sale if there's no liquidity in the estate (property is sold to pay off debt), or if the heirs cannot agree on who should inherit the property. There's thus a chance that the purchaser is going against the wishes of the heir, who may try get the Master not to agree to the sale (it's even possible that this goes to court).

If you are purchasing a property from a deceased estate, it's important that you set up the offer to purchase with guidance from an experienced conveyancer, who has experience with deceased estates; so that it has appropriate escape clauses if the sale isn't going through in a reasonable time.

Property transfer & sale Info

Sellers of property & buyers, speak to a property lawyer before you hire an estate agent!

• The property transfer process in South Africa - protect your interests.
• Conveyancing lawyers in Cape Town
  • Checklist to help you identify the best conveyancer near you.
  • Bellville conveyancing attorneys
  • Blouberg conveyancing attorneys
  • Milnerton conveyancing attorneys
  • Pinelands conveyancing attorneys
  • Tableview conveyancing attorneys
• Transfer costs calculator for property anywhere in South Africa
  • Can I negotiate transfer costs?
  • Transfer attorney fees
    • Fixed fee conveyancing in South Africa.
    • Understanding the various conveyancing costs.
    • Conveyancing quote
    • New conveyancing fees from 27 May 2024
    • Deeds office fees 29 Feb 2024.
    • Law Society conveyancing fees 2023
    • Law Society conveyancing fees 2024
    • Conveyancing fees 2025
    • Conveyancing fees 2026
    • Bond attorney fees
  • Transfer Duty calculator
  • Deceased estate property transfer costs
• Deeds Registries Act.
• Servitudes
  • Usufruct Agreement on Property in South African law
    • Usufruct value calculator (only one in South Africa)
• Land conveyancing
• Transfer attorney vs bond attorney.
• Commercial Property:
  • Transferring property as a going concern.
  • Commercial Property conveyancing quote
• Marriage/Divorce-related:
  • How to transfer property from husband to wife (or vice-versa) while still married.
    • Donation of property agreement not followed through.
    • When property is erroneously in your spouse's name.
    • "Protection" of fixed property using a trust.
    • Conveyancers conduct the transfer of property ownership between spouses.
    • Liquidator to sell property & divide proceeds as part of divorce.
• Property sales
  • Use conveyancer to guide your private property sale.
  • Instead of using real estate agents rather use professional lawyers to sell your property.
  • Urgent house sale.
  • How to check whether an estate agent is licensed.
  • Example of a property sales agreement.
  • FLISP Housing subsidies.
  • Property Practitioner's Act.
  • Code to guide conduct of property practitioners.
• Property purchases
  • Scams property purchasers should watch out for.
  • Home loan repayments calculator.
• Terminology
  • Arranging lodgement
  • Compliance certificates
  • Conveyancer's certificate
  • Deed of Sale
  • Deeds officer examiner
  • Existing bonds
  • FICA documents
  • Levy clearance certificate
  • Offer to purchase
  • Property sale agreement
  • Property search
  • Rates clearance certificate
  • Statement of account
  • Suspensive condition
  • Title deed
  • Transfer documents

Conveyancing & property transfer discussion forum

Note that this is a public forum - exercise caution before acting on info and use at own risk. No information on this website should be acted on without first consulting with a lawyer. Do not share private details here.