There have been instances where SARS has assessed transfer duty on the municipal value of the property (as opposed to the purchase price) where is value exceeds the purchase price.
SARS will ordinarily levy transfer duty on the 'declared value' (normally the purchase price), but in terms of the Transfer Duty Act, transfer duty may be levied on the 'fair value' - defined as the fair market value - which SARS may determine with regard to various factors, interalia the municipal value and a sworn valuation commissioned for the purpose.
Where the municipal valuation exceeds the purchase price, the Purchaser should note that the transfer duty payable could be higher than anticipated - or at least could become a contentious issue, necessitating the Conveyancer's intervention. A copy of any objection to the rates assessment by the Seller and the comparative market analysis done by the agent should be remitted with the Deed of Sale to the Conveyancer for submission to SARS.