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CaseLaw
CaseLaw, Attorney
Category: South Africa Law
Satisfied Customers: 1291
Experience:  BCom; LLB; Masters in Law
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Married couple could not purchase a home some about 12 years

Customer Question

Young married couple could not purchase a home some about 12 years years back because they did not qualify for bond finance. Father arranged a bond in his name and paid cash for the difference. By implication the property had to be registered at the deeds office in fathers name. Kids have since paid father back in full, and paid cash for improvements to the property to a value of close on R1,0 mil. Kids have now sold the property. At sale it was realised that the property is still registered in fathers name. QUESTION: What is the legal implication as to ownership of the property? Kids paid in full for the property and developed it further. Legal implications of ownership may effect who carries the south african income tax implications of the sale.
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Submitted: 5 months ago.
Category: South Africa Law
Expert:  CaseLaw replied 5 months ago.

Hi there and thank you for your question,

I will try to assist you with your legal question but please feel free to ask as many follow up questions as you like until you are 100% satisfied.

Legally, the property is still registered in the father's name, so he is the legal owner of the property. The children however would have a claim against the father for the money that they've paid into the bond, or repaid the father. Basically the father should be listed as the seller of the property, and he should give the proceeds from the sale to the children. That is all.

Legally the father would be liable to pay any capital gains tax on the property, as he is the owner. This can't be argued around.

I think that it doesn't actually make a practical difference to the parties who the owner is, or who pays the tax, as long as the father is happy to give the proceeds of the purchase price to the children.

If my answer hasn't answered all of your questions, please send me a REPLY with follow up questions so that I can continue to assist you in this same thread for as long as you need. Let me know if you need more advice - dont just rate my answer as "bad".

If my are HAPPY with my answer then please click one of the STAR ratings or the SMILEY FACES to rate my answer!

Good luck and best regards,

CaseLaw

Expert:  CaseLaw replied 4 months ago.

Hi there again,

I see that you've read my answer and I hope that you understood the answer and that it was useful? If you have a further question please ask it, or if you need clarity on the answer please let me know.

If you're happy that I've answered your question, please leave positive feedback for me.

Regards

CaseLaw