Buying in Cape Town vs the UK: costs and taxes

On a like-for-like £300,000 home, Cape Town's transfer duty is about double what a non-resident pays in English stamp duty. Keep a South African home, though, and your next UK purchase gets dearer still.

The short version

Transfer duty is paid by the buyer, with nothing to pay up to R1,210,000 (about £54,500) and bands up to 13%. On a R6.66 million (about £300,000) home it's about R510,000 (about £23,000) [6].
There's no foreign-buyer surcharge in South Africa. In England, a non-resident pays £11,000 on £300,000, or £26,000 if they keep a home abroad [1][2].
Banks usually lend non-residents only rand for rand with what they bring in, so about 50% of the price [10].
Selling as a non-resident for R2 million or more, the buyer withholds 7.5% of the price for SARS [7]. Sell a UK home as a non-resident and you file a 60-day return [3].
The UK–South Africa double taxation convention, dating from 2002, sorts out who taxes what [5].

Pound conversions use the Bank of England spot rate of 5 November 2026 (£1 = ZAR 22.20).

What a Brit can buy in Cape Town, compared

Back home, anyone can buy, and the real question is the tenure. In England and Wales most houses are freehold and most flats leasehold, with a lease that runs down, ground rent and service charges.

South Africa is open too. There's no blanket ban on foreigners owning homes, and plenty of Brits own from Sea Point to Somerset West. A house is usually full ownership registered at the Deeds Office, closer to English freehold. A flat is usually sectional title: you own your unit outright plus a share of the common property, with monthly levies to the body corporate. It feels like a share of freehold rather than a leasehold, with no lease clock running. Security estates add a home owners' association and its rules.

The process is different too. A signed Offer to Purchase that the seller accepts is binding, the seller's conveyancer handles the transfer, and you own the place when it's registered at the Deeds Office in Cape Town. Our guide to buying property in Cape Town as a foreigner goes through the steps, compliance certificates and the voetstoots clause.

Upfront costs side by side

Here's £300,000 spent in each place. Rates are as of November 2026.

	Cape Town, R6.66 million (about £300,000)	England, £300,000
Main purchase tax	Transfer duty: 0% to R1,210,000, then 3%, 6%, 8%, 11% and 13% bands [6]	SDLT: 0% to £125,000, 2% to £250,000, 5% above [1]
On this price	R106,784 plus 11% above R2,994,800: about R510,000 (about £23,000) [6]	£5,000 if you're UK resident and it's your only home [1]
Foreign-buyer extra	None	2% non-resident surcharge: £11,000 in total [1][2]
Owning another home	No surcharge	Higher rates if you own a home worth £40,000 or more anywhere: £20,000, or £26,000 non-resident [1][2]
New builds	VAT instead of transfer duty when bought from a VAT-registered developer	No VAT on homes
Other costs	Transfer attorney, Deeds Office fees, bond registration costs if borrowing	Solicitor, searches, survey; estate agent paid by the seller

The rates in South Africa's table have applied since 1 April 2025 and were carried over unchanged from 1 April 2026 [6]. The estate agent's commission is usually the seller's problem in both countries.

The UK catch. HMRC's higher rates apply if you'll own residential property worth £40,000 or more anywhere in the world [2]. Keep the Cape Town house, buy a flat in Bristol while you still live in South Africa, and you pay both the 5% extra and the 2% non-resident surcharge: £26,000 on £300,000. Spend 183 days in the UK in the year before buying and the 2% goes, but the 5% stays while you own both.

Scotland and Wales have their own taxes, LBTT and LTT. Neither has a non-resident surcharge, but both charge extra on additional homes: Scotland a flat Additional Dwelling Supplement on the whole price, Wales its own higher residential rates. Our guide to buying UK property from abroad has the bands.

Financing: South African bond or UK lender?

In South Africa, a mortgage is a bond, and exchange control decides how much a non-resident can borrow. If you don't live and work in South Africa, banks can generally lend R1 for every R1 you bring in, so roughly 50% of the price [10]. Live and work there on the right visa, or become a South African tax resident, and you're assessed like a local [10]. Bond rates are set off the prime rate and have usually been well above UK mortgage rates. Keep the bank records of every pound you bring in; you'll want them when you sell and take the money out again.

Back home, a UK mortgage from abroad means specialist lenders, bigger deposits and extra checks on rand income. Our guide to UK mortgages for Brits living abroad covers the FCA's foreign currency loan rules. Some Brits remortgage a UK home to buy in Cape Town instead. UK lenders won't normally lend against South African property, so that's a decision for regulated mortgage advice.

Owning it: property tax and running costs

In Cape Town, you pay municipal property rates on the City's valuation of your home, monthly. For 2026/27 the City proposed a residential rate of 0.006428 rand per rand of value, with the first R500,000 (about £22,500) rates-free [9]. On a R6.66 million home, that would be roughly R39,600 (about £1,780) a year. The final rate was set with the budget, so check your account. Add water, sanitation and refuse charges, sectional title levies or estate fees, and the cost of keeping the lights on through any load-shedding: an inverter or solar setup is part of the price of many homes.

Back home, council tax is the counterpart. A UK house kept as a second home can cost more, not less: councils in England have been able to charge a second homes premium since April 2025, and Welsh councils have premiums of their own.

Letting the UK home. If you live in Cape Town and let your UK house, the Non-Resident Landlord Scheme applies. A letting agent, or a tenant paying more than £100 a week, must take basic rate tax off the rent and pay it to HMRC each quarter unless HMRC approves you to receive it gross [4]. You apply on form NRL1 and still file a Self Assessment return. See renting out your UK home.

Tax when you sell

The South Africa side

Withholding. If you're not South African resident and sell for R2 million or more, the buyer must hold back 7.5% of the price for SARS (10% for a company, 15% for a trust) [7]. On R6.66 million that's R499,500 (about £22,500). It's an advance on your tax, not the bill, and you can ask SARS for a lower rate on form NR03, usually within about 21 business days [7].
Capital gains tax. South Africa taxes part of the gain as income. For individuals the maximum effective rate is 18%, with an annual exclusion of R50,000 (about £2,250) [8].
Primary residence exclusion. The first R3 million (about £135,000) of gain on a primary residence is excluded [8]. It's aimed at a home you actually live in, so a holiday home or a non-resident's house usually doesn't qualify. Your conveyancer or a tax adviser can confirm.

The UK side

Selling your UK home while living in South Africa. Non-residents pay UK capital gains tax on UK property. Report the sale online within 60 days of completion and pay within the same 60 days, even with no tax to pay or a loss [3]. For homes owned before April 2015, usually only the growth since 5 April 2015 counts, and private residence relief can still cover years you lived there. South Africa taxes its residents on worldwide gains, so a South African resident may report the same sale there and claim credit.
Selling the Cape Town home after moving back. A UK resident pays UK capital gains tax on a gain abroad, at 18% or 24% for 2026/27, with a £3,000 annual exempt amount [1]. The gain is worked out in pounds, and a falling rand can shrink it or turn it into a loss.
Double taxation. Under the 2002 UK–South Africa convention, South Africa can tax gains on South African property and the UK gives credit for South African tax on the same gain [5].
Private residence relief can apply to a home abroad that was genuinely your main residence, but the day-count rules are fiddly. A tax adviser who knows both countries can check your case.

Which makes sense for whom

Settling in Cape Town on a residence visa. Buying can work: no foreign surcharge, local lending once you live and work there, and the primary residence exclusion if it's your home.
Buying a holiday home from the UK. Expect to fund about half in cash, pay transfer duty with no relief, and face SARS withholding when you sell. Run the rand risk both ways.
Trying it out first. Renting keeps your capital liquid and out of exchange control. See renting in Cape Town.
Keeping the UK house and letting it. Get NRL1 approved before you fly, and remember the Cape Town home puts a future UK purchase on the higher stamp duty rates while you own both. Sell your old main home within three years of buying a new one and the higher rates can be reclaimed [2].

Before you sign an Offer to Purchase, ask around in our community group for Brits in South Africa. Someone will have bought in the same suburb.

Buying in Cape Town vs back home: transfer duty, the 50% rule and stamp duty