Do you have questions about Clearance Figures, Municipal Clearance Certificates, or Section 118 of the Municipal Systems Act? Our Frequently Asked Questions section covers the most common questions we regularly get asked and everything you need to know, from applying for Clearance Figures to understanding Historical Debt. We provide clear answers to help you navigate your Municipal Debt concerns with ease.
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Clearance figures should represent the total amount of Municipal Debt owed on a property. These figures are crucial for property transactions, as they determine whether all outstanding Municipal charges, such as rates, taxes, water, electricty, refuse, sewerage, ie services, have been paid.
To complete a property transfer, a Clearance Certificate is required, which confirms that the last two years of Municipal Debts have been settled. Clearance Figures are issued by the Municipality and must be obtained before the property can be legally transferred or sold.
Click here to view an Example of Property Rates & Taxes Municipal Clearance Figures
A Municipal Rates and Taxes Clearance Certificate is an essential document required by the Registrar of Deeds and your Conveyancing Attorney to finalise the transfer of a property. This certificate serves as proof that all Municipal Debts associated with the property have been settled. Specifically, it certifies that all outstanding amounts owed to the Municipality for the past two years have been paid in full.
Click here to view an Example of a Property Rates & Taxes Municipal Clearance Certificate
Process for Obtaining and Reducing Municipal Clearance Figures
- Clearance Figures Requirement: Your transferring attorney is responsible for obtaining valid clearance figures. These figures must be current and not expired allowing us 2 weeks grace period to do what we need to do.
- Our Role: Once we receive the valid clearance figures, we will conduct a thorough audit and investigation to identify and create the potential reductions.
- Finalising the Matter: After completing our review and achieving reductions, we will provide you with a breakdown of the new, reduced amounts payable to the Municipality incuding our fee recovered out of the savings.
- Issuance of Clearance Certificate: Upon settlement of these reduced amounts, the Municipality will issue a clearance certificate. Your transferring attorney can then proceed with lodging and registering the property at the deeds office.
By following this process, we ensure that all Municipal Debts are properly addressed, facilitating a smooth property transfer.
If You Have Received High Clearance Figures from Your Transferring Attorney:
- Contact Us for a Free No Obligations Prognosis/Review: Reach out to us to review and analyse the high clearance figures. We specialise in reducing Municipal Debts and can help lower the amounts due. Once you have mandated us; we will conduct a thorough audit of your Municipal accounts to identify any inaccuracies or discrepancies.
- Execute Reductions: We will deal with the Municipality in order to reduce the outstanding amounts and rectify any errors in the figures.
- Obtain Updated Figures: After our intervention, we will provide you with updated, reduced clearance figures.
- Ensure Smooth Transfer: With the revised figures, your transferring attorney can obtain a Clearance Certificate and proceed with the property transfer without unnecessary delays.
- By taking these steps; you can potentially save money and ensure a smoother property transfer process.
We offer exceptionally fast turnaround times for the Ekurhuleni Municipality. For other Municipalities, such as the City of Johannesburg (COJ) and Tshwane, we handle each case on an individual basis. Our approach ensures that we provide the most effective service tailored to the specific requirements and complexities of each municipality. We will consider other Municipalities merit based.
Transferring a Property Includes:
- Normal Transfers: When you have sold or bought a property.
- Deceased Estates: Transfers involving estates of deceased individuals.
- Sequestrations and Liquidations: Transfers related to insolvency proceedings.
- Auctions and Repossessions: Transfers resulting from auctions or repossessions.
We operate on a completely risk-free basis for our clients—there are no upfront costs whatsoever for our services. We handle the investigation and reduction of your Municipal Debt at our own risk. Our fees are recovered as a fraction of the savings we achieve for you.
How It Works:
- No Upfront Costs: We offer our services with absolutely no risk to our clients.
- Risk-Free Investigation: We undertake the investigation and debt reduction at our own risk.
- Fees from Savings: Our fees are covered entirely by the savings we generate. If we don’t achieve savings, you don’t pay a cent.
Why Wait? Let us handle the complexities while you enjoy the peace of mind knowing you’ll pay a lower amount than what the Municipality was claiming, including our recovered fees.
Contact us today to get started! Alternatively contactour Free Rates Help Desk now.
We recognise the importance of timely property transfers and work swiftly to ensure that delays are minimized. Our goal is to achieve substantial savings without holding up the transfer process.
Turnaround Times:
- Ekurhuleni Municipality: We offer exceptionally fast turnaround times, typically within one to two weeks.
- Other Municipalities: For areas like the City of Johannesburg (COJ) and Tshwane, turnaround times can vary. We assess each case individually to provide the most efficient service possible
- By acting quickly and efficiently, we strive to streamline the process and avoid unnecessary delays, ensuring a smooth transfer experience for all parties involved.
Understanding Municipal Debt and Clearance Certificates
This is a commonly misunderstood issue. The law applies differently depending on the type of property transfer, and this is where our expertise comes into play to ensure you pay only the bare legal minimum.
For standard property transfers, paying off the last two years of Municipal Debt may be sufficient to obtain a Clearance Certificate. However, this does not absolve you of any “HISTORICAL DEBT” incurred before this period. As the property owner, you remain responsible for all debts linked to the property since you acquired it, subject to certain legal limitations.
For other types of transfers, such as those involving deceased estates, sequestrations, liquidations, auctions, or repossessions, the rules differ, and the legal amounts the Municipality can claim vary. Our team has the knowledge and expertise to navigate these complexities, ensuring that everything is handled correctly to maximize savings and minimize stress.
Why Comprehensive Debt Resolution Matters:
- Preventing Negative Consequences: To avoid potential debt collection actions, blacklisting, or adverse effects on your credit record, it is essential to ensure a complete resolution of all Municipal Debts.
- Dealing with Bully Tactics: Some Municipalities may employ aggressive tactics, such as refusing to open a new consumer account or provide services to new owners, complicating your situation further. We have witnessed and contested many such unethical and sometimes illegal practices in court.
Our Essential Services:
Our services are crucial in managing and resolving these issues. We conduct thorough investigations, audits, and reductions of all debts related to your property. This includes both the amounts required for a Clearance Certificate and any historical debts, ensuring a clean slate for your property.
Contrary to popular belief, a Clearance Certificate only confirms that the last 24 months of Municipal Debt have been paid—it does not clear all debts on a property. “Historical Debt” refers to any outstanding Municipal Debt associated with a property that dates back more than 2 years before the period covered by the Clearance Certificate. While you might be able to settle the last 2 years’ worth of Municipal Debt to obtain a Clearance Certificate, this doesn’t simply erase any older debts. Many property professionals do not advise owners of properties of this truth and later have terrible comebacks post transfer as the debts were not dealt with correctly!
These older debts, incurred before the 24-month period covered by the Clearance Certificate, remain tied to the property, and as the owner, you are still responsible for them. It’s crucial to address these debts properly to avoid future complications.
It is to be noted that this is the case for a normal property transfers. For other types of transfers, such as those involving deceased estates, sequestrations, liquidations, auctions, and repossessions, different laws, legalities and limitations apply. Our proven success, reputation and expertise is invaluable in navigating these complexities, ensuring that you’re not unfairly burdened with debts that aren’t your responsibility.
Our goal is to make the property transfer process as smooth and cost-effective as possible for you, depedning on what type of property transfer it is.
Yes. Here’s what you need to do:
For Sellers:
- Notify the Municipality: It is absolutely imperative that you inform the Municipality that the property has been registered in the new owner’s name.
- Prepare Documentation: The transferring attorney usually prepares all the necessary documentation (e.g., confirmation of registration, new deeds search showing the new transfer was effected, etc.) for you to hand-deliver to the Municipality.
- Final Meter Readings: Insist that the Municipality conducts a final reading of your water and electricity meters. This ensures that the new owner does not accumulate charges on your account once they move in.
For Buyers:
- Open a New Consumer Agreement: As the new buyer, it is imperative that you visit the Municipality and comply with their requirements to open a new Consumer Agreement.
- Avoid Service Termination: Failure to open a new account puts you at risk of having water and electricity services terminated due to arrears in the previous owner’s name.
- Avoid Disputes: If these steps are not followed, it can lead to significant disputes between all parties involved. Ensuring these actions are completed will help prevent any misunderstandings or conflicts.
A Few More Questions and a Little more info:
No, we do not limit our services to only large matters or high amounts. Our primary focus is on providing value to our clients, regardless of the size of the Municipal Clearance Figures involved. Whether it’s a small or significant amount, we assess each case individually to ensure it’s worthwhile for both the client and ourselves.
To make this process even easier, we offer a Free Rates Help Desk where clients can get a no-obligation analysis of their Clearance Figures. This service allows you to understand potential savings and determine if it’s beneficial to proceed with our full service.
We encourage you to take advantage of this free resource. For more information, please visit our Free Rates Help Desk page.
This way, you can be confident that you’re making the best decision for your property, no matter the amount involved.
No. Although we have successfully taken Municipalities to court to protect our clients’ rights, our main focus is on reducing high Clearance Figures by working closely and harmoniously with Municipalities. Leveraging our extensive experience and deep understanding of the law, we ensure Municipal debts are resolved efficiently and cost-effectively. We prioritise reaching favourable settlements to reduce the financial burden on property owners, turning to litigation only as a last resort when absolutely necessary to uphold our clients’ rights.
The Constitutional Court is the highest authority in South Africa on constitutional matters. It exclusively handles issues related to the Constitution and its decisions are final, meaning they cannot be altered by any other court.
Our landmark case in the Constitutional Court was pivotal. It safeguarded property owners from unfair debt transfers and reinforced our reputation as leaders in municipal debt resolution, establishing crucial legal precedents that protect property rights across South Africa.
Please read more below: “WHAT IS THE CONSTITUTION?”
The Constitution is the supreme law of South Africa, agreed upon by the people’s representatives. It outlines how the state is constituted and governed, defines our rights and responsibilities as citizens, and establishes specific institutions to support and safeguard our democracy. The South African Constitution is renowned for its commitment to human rights, equality, and justice, reflecting the country’s dedication to overcoming its past of discrimination and inequality.
Our Landmark Constitutional Court Case
Our firm has played a pivotal role in upholding these constitutional values through our involvement in a landmark Constitutional Court case, the Jordaan et al. matter. Our huge case was a significant victory for property owners across South Africa, as it protected them from being held liable for historical debts incurred by previous owners. The municipalities were attempting to transfer these old debts to new, innocent owners, which would have had severe financial implications for property buyers and sellers alike.
The Impact of Our Work
Our Constitutional Court victory ensures new property owners aren’t burdened with previous owners’ debts, upholds constitutional rights, sets important legal precedents, and has established us as leaders in municipal debt resolution and property law.
Why Choose Us?
By choosing our services, you are partnering with a firm that has not only demonstrated legal expertise but has also shown a strong commitment to protecting the rights of property owners. Our victory in the Constitutional Court is a testament to our dedication and skill in navigating complex legal issues to achieve just outcomes. We continue to apply this expertise to ensure that our clients receive the best possible support in resolving municipal debts and safeguarding their property rights.
City of Ekurhuleni Metropolitan Municipality covers an extensive area from Germiston in the west to Springs and Nigel in the east. The former administrations of the nine towns in the former East Rand were amalgamated into the metropolitan municipality, along with the Khayalami Metropolitan Council and the Eastern Gauteng Services Council. It is one of the most densely populated areas in the province, and the country.
The economy in the region is larger and more diverse than that of many small countries in Africa. It accounts for nearly a quarter of Gauteng’s economy, which in turn contributes over a third of the national Gross Domestic Product. Many of the factories for production of goods and commodities are located in Ekurhuleni, often referred to as ‘Africa’s Workshop’.
Alberton
Alberton encompasses a variety of suburbs, including Alberante, Albertsdal, Albertskroon, Alrode, Brackendowns, Brackenhurst, Florentia, General Alberts Park, Meyersdal, New Redruth, Randhart, and Verwoerdpark.
Bedfordview
Bedfordview is home to several well-known suburbs such as Bedford Gardens, Bedford Park, Essexwold, Morninghill, Oriel, Senderwood, and St Andrews.
Benoni
Benoni features a wide array of suburbs, including Airfield, Alphen Park, Benoni CBD, Benoni North, Benoni West, Brentwood Park, Cloverdene, Crystal Park, Daveyton, Fairleads, Farrarmere, Goedeburg, Lakefield, Lakeside, Mackenzie Park, Morehill, Northmead, Norton Home Estate, Rynfield, and Westdene.
Boksburg
Boksburg includes many vibrant suburbs like Beyers Park, Boksburg South, Boksburg West, Cinderella, Comet, Dawn Park, Dayanglen, East Rand, Freeway Park, Hughes, Impala Park, Jet Park, Jansen Park, Libradene, Parkdene, Parkrand, Sunward Park, Van Dyk Park, Witfield, and Windmill Park.
Brakpan
Brakpan consists of a number of key suburbs such as Anzac, Brakpan CBD, Dalpark, Dalview, Helderwyk, Kenleaf, Leachville, Minnebron, Sonneveld, and Tsakane.
Edenvale
Edenvale is comprised of numerous suburbs including Dowerglen, Eastleigh, Edenglen, Eden Glen, Elma Park, Greenstone Hill, Harmelia, Hurlyvale, Illiondale, Isandovale, Marais Steyn Park, and Sebenza.
Germiston
Germiston is home to a multitude of suburbs such as Albemarle, Castleview, Dawnview, Delville, Dinwiddie, Elsburg, Estera, Fishers Hill, Gerdview, Germiston South, Hazel Park, Homestead, Lambton, Marlands, Meadowdale, Primrose, Primrose Hill, Roodekop, Simmerfield, Solheim, Sunnyridge, Symhurst, Wannenburghoogte, and Webber.
Katlehong
Katlehong features several important suburbs including Goba, Hlahatsi, Khumalo Valley, Magagula Heights, Moleleki, Mngadi, Sontonga, Spruitview, and Tshongweni.
Kempton Park
Kempton Park encompasses a variety of suburbs, such as Aston Manor, Birch Acres, Birchleigh, Bonaero Park, Bredell, Chloorkop, Edleen, Esther Park, Glen Marais, Kempton Park CBD, Norkem Park, Pomona, Rhodesfield, Spartan, and Van Riebeeck Park.
Nigel
Nigel includes a number of key suburbs like Dunnottar, Ferryvale, Nigel CBD, Pretoriusstad, Sharon Park, and Vosterkroon.
Olifantsfontein
Olifantsfontein is made up of suburbs including Clayville, Olifantsfontein, and Winnie Mandela Park.
Springs
Springs features a wide array of suburbs such as Bakerton, Casseldale, Dersley, Edelweiss, Eastvale, Krugersrus, Lodeyko, New Era, Nuffield, Pollak Park, Selection Park, Selcourt, Springs CBD, Strubenvale, and Wright Park.
Tembisa
Tembisa consists of numerous suburbs including Ebony Park, Emoyeni, Endayeni, Hospital View, Ikusasa, Inxiweni, Kopanong, Lefisang, Mashimong, Matolong, Motsu, Sedibeng, Umfuyaneni, and Winnie Mandela Park.
Tokoza
Tokoza is home to several notable suburbs such as Ehlanzeni, Ekurhuleni, Endayeni, Entshonalanga, Katlehong, and Tokoza Extension.
Vosloorus
Vosloorus encompasses a variety of suburbs including Extension 1, Extension 2, Extension 3, Extension 4, Extension 5, Extension 6, and Extension 7.
By-laws are laws that are passed by the council of a municipality to regulate the affairs and the services the municipality provides in its area of jurisdiction. A municipality derives the power to pass a by-law from the Constitution of the Republic of South Africa, 1996, which gives specified powers and competencies to local government as set out in Part B of Schedule 4 and Part B of Schedule 5. The main function of the City of Tshwane’s by-laws is to ensure that Tshwane is an orderly city to live and work in.
Restraint Of Transfer On Property:
“118 (1) A registrar of deeds may not register the transfer of property except on production to that registrar of deeds of a prescribed certificate-
(a) issued by the municipality or municipalities in which that property is situated;
and
(b) which certifies that all amounts that became due in connection with that property for municipal service fees, surcharges on fees, property rates and other municipal taxes, levies and duties during the two years preceding the date of application for the certificate have been fully paid.
(3) An amount due for municipal service fees, surcharges on fees, property rates and other municipal taxes, levies and duties is a charge upon the property in connection with which the amount is owing and enjoys preference over any mortgage bond registered against the property”
In Simple Terms:
- Before You Transfer Property: You need to get a certificate from the Municipality showing that all the property’s Municipal bills/charges for the last two years are paid. This is required for the property transfer to be officially recorded.
- Outstanding Debts: Any unpaid Municipal bills are tied to the property and must be cleared before you can complete the transfer. These debts have priority (preference) over any mortgage or loan.
- Peace of Mind: This ensures that all property-related debts are settled, protecting both the buyer and the seller from potential issues related to unpaid Municipal charges.
Section 118 (1):
- What It Means: When you want to transfer ownership of a property (like selling it or changing its ownership), the law requires you to get a special certificate from the local Municipality (where the property is located).
- Certificate Details: This certificate proves that all the Municipal bills for the property (such as water, electricity, property rates, and other fees) for the past two years have been paid in full.
- Why It’s Required: Without this certificate, the transfer of the property cannot be registered officially.
Section 118 (3):
- What It Means: Any unpaid Municipal bills (such as property rates and taxes, service fees etc) are considered a debt attached to the property itself. This means these debts enjoy preference over and take priority over any mortgage bond or loan registered against the property. We scrutinize these claimed amounts owing outside of the Clearance Certificate period of 2 years and settle all legal amounts owed to the Municipality.
- Priority of Debt: If there are outstanding Municipal debts, these must be settled before the property can be transferred or before any mortgage holder can claim their rights. For this reason it is imperative we deal with not only the Clearance Figures for a Clearance Certificate but settle this debt after we have have challenged the amounts claimed.
Referral Commission Opportunities:
Curious about how you can earn commission by referring clients to our services? We’re excited to share that we offer referral commissions for successful client referrals.
Contact Us to Learn More:
If you’re interested in our referral programme and want to understand how you can benefit, please reach out to us directly. We’re happy to discuss the details and show you how partnering with us can be a win-win for everyone involved.
Why Partner with Us?
- Risk-Free Service: We work on a risk-free basis, charging only a fraction of the savings we create for the client.
- Professional Expertise: Our services enhance the efficiency and professionalism of transferring attorneys, real estate agents, and property owners.
- Proven Success: With a long-standing reputation and numerous successes in Municipal Debt reduction, partnering with us ensures that your referrals are in expert hands.
- For more information or to discuss potential referrals, please contact us directly.