|SCA finds contract cancellation by e-mail and digital signatures valid|
|On 21 November 2014, the Supreme Court of Appeal ruled that oral negotiations between parties that have been reduced to writing in the form of emails constitute an agreement to cancel their written agreements.
Also, the SCA has found that typewritten names of the parties at the foot of emails constitute ‘data’ that is logically associated with the data in the body of the emails, as envisaged in the definition of an ‘electronic signature’ [which is not to be confused with an advanced electronic signature]. These, therefore, satisfy the requirement of a signature and have the effect of authenticating the information contained in the emails. ► Download the judgment in Spring Forest Trading 599 CC v Wilberry (Pty) Ltd T/A Ecowash and Another Case No: 725/13 here.
Monthly Archives: November 2014
|SNEAK PREVIEW – VILLIERSDORP MOUNTAIN ESTATE LAUNCH|
|37 new units are being developed in Villiersdorp
A few units will be made available on Rent2buy – contact email@example.com
Contact Meyer@oostco.co.za for more information
A few units will be made available on direct rental as well.
Construction of the first 3 houses have already started and hand-over is planned for January 2015.
PRIVATE PROPERTY To view more on Private Property VIEW YOUR LISTING NOW Listing reference number Z25592
Contact Meyer de Waal – firstname.lastname@example.org if you are interested in more information.
LATEST FLISP NEWS – RELIEF FOR PROPERTY DEVELOPERS & HOME BUYERS
Property developers have been hampered by the challenge to deliver a house under the price range of R300 000.00 to make use of the FLISP subsidy and this prevents many aspiring home owners to buy their own homes.
The Director General published enhancements to the Financial Linked Individual Subsidy Plan (FLISP) with the view to have a positive effect on the participating number of affordable households and thus address then need of households in the affordable market with specific reference to:
• The minimum subsidy payable
• The maximum property value
• The housing typology
For more info – go to http://www.flisp.co.za and click on Flisp Adjustments August 2014 under Latest Flisp Info.
|There is hope for those who desperately want to buy a house even if their home loan application has been declined, according to property attorney Meyer de Waal.
De waal, who is the director at Oosthuizen & Co Meyer de Waal, told Fin24 in a video interview that there is a way for consumers to still get a bond even if they have been turned down by banks.
He said usually when a bond application is rejected; it is based on a client’s poor credit scorecard.
“Why do you need a bank from day one to conclude your transaction? Everyone is so fixed on going to a bank to get a home loan. We say, park the bond or the bank a little bit outside for a year or two.
“You’ve got a willing seller, you’ve got a willing buyer and you’ve got a property. Those are the most important ingredients to negotiate a transaction,” said De Waal
Meyer de Waal, who developed and fine-tuned the rent2buy concept was recently interviewed by Fin24. To follow the interview click here
| Mountain View Villas released 3 rent2buy units – If you are interested to secure a unit – act fast and contact Juanita – email@example.com The minimum income that is required is R12 000.00 per month and the rental is R3 850.00 per month. We will do a credit and affordability check to ensure that you must qualify for a home loan within 12 months after signature.
To download the Mountain View Villas brochure CLICK HERE Kind regards, Meyer de Waal
|To keep up with inflation certain adjustments were made in the Administration of Estates Act. We just received notice that as from 24 November 2014 the limits of various sections were amended in the Administration of Estates Act.|
|For more information – contact Meyer de Waal – firstname.lastname@example.org Kind regards, Meyer de Waal|
We assisted the original owner to lay out various units on their farm outside Greyton.
Over the past years one of the owners designed and constructed beautifully newly built luxury destination situated in the Heuningkloof Wine Estates, with just a 10 minute drive from Greyton. Nestled in its own valley, enjoyed by unparalleled 360 degree panoramic views of the Riviersonderend Mountains and undulating farmlands of the Overberg.
The owners decided to retire and relocate to the UK due to health reasons and this remarkable property is now for sale.
In these peaceful surroundings, old friends and new guests can enjoy their dream home offering of 3 beautifully appointed luxury bedrooms within the farm house, all with private entrances and stunning views. Guests will be spoilt with the famous breakfasts on the stoep, next to the pool or in inclement weather, in the GRAND dining room in front of a roaring fire and pampered with country hospitality and warmth.
In just one year, thanks to its unique undisturbed location, coupled with imaginative planting and creative landscaping, it has attracted and permanently adopted a broad section of wild life from Reebok to Golden Mongoose, a myriad of water birds regularly visit their ponds and a family of Blue Crane stay. This can all be viewed from the house. Being part of the beautiful Heuningkloof boutique Wine Estate, you can share in wonderful fishing, picnic and swimming facilities on the private owned banks of the Sonderend River. (Picnic hampers will be made up, just organise your own food). The area is fast establishing its facilities and location as a mountain bikers dream!
Three self-catering cottages are planned for 2012 offering discerning guests every aspect of affordable, luxury and caring attention to detail. Nature’s total peace and tranquillity will ensure a memorable stay.
- 3 en-suite luxury bedrooms :
- Room 1 (Poppy) – ground level – King size, Extra Long, Wet room with shower (no bath) with large West facing private stoep.
- Room 2 (Thyme) First floor, large room with queen bed and one extra single bed. Wet room with shower and bath.
- Room 3 (Rosemary) First floor, smaller room with queen bed with shower and bath. This room also has a balcony.
- All bedrooms have own entrance
- All bedrooms with under floor heating and heated towel rails
- All rooms equipped with Small fridge, microwave oven and Tea/Coffee facilities
- TV in bedrooms on request
- All bedrooms fully equipped with hair dryers, toiletries, etc.
- Large Swimming pool and deck
- Lapa with full braai facilities provided (just bring your own food)
- Two kilometre walks within own perimeter
The holiday season is around the corner and Adrian would like to buy a beach house. He wishes to use this holiday residence mainly as a long term investment by renting it out to other holidaymakers in order to earn extra income. Adrian has also decided that upon his death the beach house must be bequeathed to his sons while his wife receives the rental income earned thereon. Adrian is one of many buyers that have the following question: In which entity should I buy my holiday home?
Each buyer’s situation is different, so there is no one correct answer to this question. The entity in which a buyer should buy his property will depend on his personal financial circumstances and the reasons why he wants to buy the property. In order to make an informed decision, the advantages and disadvantages of Adrian’s options must be considered.
Purchase in personal capacity
If Adrian purchases his holiday home in his personal name, the following principles will apply:
- No transfer duty is payable on the first R600 000.00 of the purchase price.
- From R600 001.00 to R1 000 000.00 transfer duty at a rate of 3% of the amount above R600 000 will be charged.
- From R1 000 001.00 to R1 500 000.00 transfer duty of R12 000 plus 5% of the amount above R1 000 000.00 will be charged.
- From R1 500 0001.00 transfer duty at R37 000.00 plus 8% of the amount above R1 500 000.00 will be charged.
- In the case of property purchased primarily as a primary residence, the first R2 million of the capital gain on the sale is disregarded for purposes of capital gains tax.
- If the property is not purchased primarily for residential purposes the sale will have capital gains tax consequences. R30 000.00 of the total capital gain will be disregarded. After that, 33.33% of the capital gains derived from the alienation of the property will be included in a seller’s annual taxable income.
- At the owner’s death the holiday home will form part of his estate for estate tax duty purposes. A deduction of R3.5 million against all assets in the estate is allowed with the balance of the estate taxed at 20%.
- Capital gains tax will also be relevant at the owner’s death, regardless of whether the beach house is sold or not. The fair market value of the property at the date of the owner’s death will be determined and consequently, the growth in the value of the property in his estate will be taxed. If the property is bequeathed to the owner’s surviving spouse, no capital gains tax will be payable. If however the surviving spouse dies or the property is sold, the capital gain on the disposal will be calculated from the date the property was bought.
- The property will continue to be susceptible to seizure by creditors if the owner of the property becomes insolvent.
- If the owner dies, his will determines to whom the beach house must be bequeathed. However, complications may arise where more than one heir stands to inherit the beach house. Questions such as who is entitled to use it, who is responsible for the maintenance thereof and who is entitled to the income earned thereon, are often questions that arise when property is owned by more than one owner.
Purchase in family trust
If Adrian however purchases the beach house in the name of his family trust, the following principles will apply:
- Transfer duty was calculated in the past at a fixed rate of 8% from the first Rand. However, since 23 February 2011 trusts pay transfer duty at the same scale and with the same exemptions as natural persons.
- Capital gains tax can be calculated in two ways. First, the capital gains can be taxed in the hands of the trust, in which case 66.6% of the profit is included in the trust’s taxable income and taxed at 40%, which results in an effective capital gains tax rate of 26.7%. Secondly, the capital gains can be distributed to the beneficiaries, in which case the capital gains will be taxed at the respective income tax levels of the beneficiaries. Individuals pay income tax at a rate ranging between 18% and 40% and accordingly capital gains tax at a maximum rate of 13.3% will apply.
- Income earned by the trust will, as in the above case, be taxed in the hands of the trust, or it can be distributed to the beneficiaries in order to be part of the gross taxable income of the various beneficiaries.
- Income tax and capital gains tax can therefore be reduced by distributing the income and the capital gains of the trust among major beneficiaries with lower income tax levels.
- No donation tax is payable if the capital gains made on the disposal of the beach house is distributed to beneficiaries.
- The beach house will not form part of an owner’s estate for tax purposes, and accordingly the trust plays an important role in estate planning.
- Since the beach house is not part of the owner’s estate, no capital gains tax is payable upon his death.
- The complications that arise when the beach house is owned by more than one owner can be largely eliminated as the trust remains the owner of the beach house, even after the owner dies.
- The trust is a separate legal entity and the trust assets are accordingly protected from seizure by creditors.
- Should financing be required to purchase the beach house, the trustee can apply for financing and the rent the property to Adrian and/or others in order to service the instalments.
It is clear from the above explanation that the objectives of the buyer must be taken into account in order to identify the most appropriate entity in which he can buy his new property. The buyer must therefore ask himself the following questions to determine his position:
- What do I want to do with the property? Do I buy it for a short term period, or do I keep it as a long term investment?
- How do I finance the property? Will it be a rental property? How do I structure this?
- Will I restore and renovate the property in order to sell it again at a profit, or do I buy the property with the intention of bequeathing it to my children one day?
- Do I wish to protect my assets from creditors?
- Will the property be my primary residence?
Considering Adrian’s circumstances and objectives, a trust will be an appropriate entity in which to purchase his beach house, especially because he sees it as a long term investment. Adrian will in this case enjoy protection from creditors and not pay estate duty. He can also nominate his sons as capital beneficiaries in the trust to ensure that the beach house is inherited by his sons. His wife can be nominated as an income beneficiary in his trust to earn the rental paid on the property.
Finally, the Minister of Finance’s budget speech for 2013 must be kept in mind. It appears that the flow of income and capital gains through trusts to beneficiaries may come under fire in future. All income not actually distributed to beneficiaries may be at risk of being taxed in the trust. Income that is distributed to beneficiaries will then probably be allowed as a deduction for the trust and taxed as ordinary income in the hands of the beneficiaries.
Yet at this stage the proposed amendments of our tax laws is still only a possibility about which there currently is only speculation. In the meantime it would be advisable to seek professional help in order to assist you in analyzing your financial situation, circumstances and choice of the most appropriate entity in which to buy your property.
The following conclusion can be made: Due to the fact that the first R2 million capital gains made on the sale of your primary residence is exempt from capital gains tax, it may from a tax perspective be preferable to buy your primary residence in your personal capacity. However if your concern is about protection against risk, then a trust that is properly managed is an important option for consideration. If you are buying a second home and your estate is worth more than R3.5 million, you may wish for both tax and protection purposes, to consider purchasing the property in a trust. Most importantly: seek advice as to what is appropriate to your specific circumstances.
13 November 2014 | Weich & Kriel Inc | News 360 Notifications and Updates
Before you say “I do”, there’s another question that must be answered.
|November and December – the most popular months for weddings in South Africa – are rapidly approaching.
Without wanting to rain on the parade of the thousands of happy brides and grooms as they prepare to walk down the aisle, a question which has to be asked is: do you know exactly what you are getting yourself in to – financially?
If a recent survey conducted by TransUnion in Hong Kong is anything go by, the answer is probably “No”.
This survey of 250 engaged couples found that over 58% said they had little or no knowledge of their partner’s finances; nor did they trust their significant other with details of their own finances.
In fact, 19% of respondents believed that personal finances should only be discussed after they were wed, although 22% of respondents said they wanted to remain financially independent even after the big day.
TransUnion recommend that engaged couples openly discuss their finances and debts in order to mitigate any financial risks post-marriage.
Understanding your partner’s credit history can help you to avoid surprises and plan better for a secure future.
Work together to ensure that your bills are paid on time. This will help you reduce interest payment and avoid over-stretching yourselves. Starting your new life together could be a lot smoother with a solid financial and debt management plan as well as a monthly budget in place.
|DEEDS OFFICE DELAYS – HOW LONG CAN ONE EXPECT TO RECEIVE YOUR TITLE DEED AFTER REGISTRATION?
The Deeds Office has released its latest communication 17 of 2014 in which it explains that the delivery of registered title deeds is taking 4 months due to operational issues. The effect of this is that title deeds registered on 4 July 2014 will be delivered +/- 10 November 2014.
IS THERE A WAY TO FAST – TRACK A DELIVERY?
One must expect that the deeds will be swamped with requests to fast-track deliveries – but bear in mind that they may approve such as an exception rather the rule.
HOW DOES IT WORK?
One can still apply to expedite title deeds after 21 working days after registration but the deeds office has requested that this only be done in urgent situations as the requests for expedited deliveries has increased dramatically. The application for expedited must still be done on the company letterhead and accompanied by a deeds office tracking print out obtainable from Info Section.
Due to on-going system problems the turnaround times for delivered deeds is difficult to project and one can only submit a follow up request 10 days after the initial request for expedite was given. In light of the above expedited title deeds should only be requested where they are required for an ensuing transaction to allow the deeds office to catch up with the heavy backlog.