On 22 September 2015 the South African Revenue Service released Issue 3 of Interpretation Note No. 22 ("IN 22").
IN 22 explains exemptions provided for in sections 9(1)(c) and 9(1A) of the Transfer Duty Act No. 40 of 1949 (the "Transfer Duty Act"). The specific exemptions explained in IN 22 pertain to Public Benefit Organisations ("PBO") and certain statutory bodies.
Section 9(1)(c) of the Transfer Duty Act effectively provides that no transfer duty is payable where a PBO or other qualifying body (in terms of section 10(1)(cA)(i) of the Income Tax Act No. 58 of 1962) acquires property where the whole or substantially the whole of the property will be used for the purposes of a public benefit activity which that PBO/body carries on. It provides further that where the use of the property changes to a use other than the public benefit activity, transfer duty will be payable and the section deems the date of acquisition as the date on which the use of the property changed.
Section 9(1A) of the Transfer Duty Act provides that no transfer duty is payable on the transfer of property from a PBO to an entity controlled by that PBO.