What are municipal property rates?
Municipal property rates are a cent amount in the Rand rate levied on the market value of the property.
The Constitution of the Republic of South Africa gives municipalities the power to value and rate property in their area of jurisdiction.
Who is liable for the payment of property rates?
All owners of rateable property are liable for the payment of rates.
How are property rates determined?
Municipal Property rates are calculated by multiplying the market value of property by a Cent amount in the Rand rate that a municipal council has determined. For example:
If the market value of property is R 50 000, and the cent amount in the Rand rate is R0.015 (which is 1.5 Cent), the amount due for property rates is R50 000 x 0.015 = R750 for the whole year, which means that every month the property owner will pay R62.50 (this is calculated by dividing R750 by 12 as the year has 12 months) to the
If the property in question is used for residential purpose (home):
The cent amount in the Rand rate will be applied after deducting the first R15 000 of the market value of such residential property (this is a minimum requirement of the Municipal Property Rates Act), which means that the R0.015 will be applied to R35 000 rather than
R50 000 (that is, R50 000 less R15 000); and
The rates payable by the homeowner will then be = R35 000 x 0.015 = R525 for the whole year, which means that every month the property owner will pay R43.75 to the municipality.
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