In South Africa, the Financial Intelligence Centre Act (FICA) was introduced to combat money laundering, tax evasion, and the financing of terrorism. When you buy property, you and the seller must comply with FICA requirements before the transfer can be registered.
Here’s what you need to know:
1. Why FICA is Important in Property Transactions
- The Act requires attorneys, estate agents, and financial institutions to verify the identity and address of their clients.
- Compliance prevents fraudulent property transactions.
- The transferring attorneys (conveyancers) are the ones who enforce FICA during the property transfer process.
2. Documents You Will Need
The exact requirements may vary depending on whether you are a natural person, a company, a trust, or a foreign national, but generally:
If you are an individual (South African citizen or resident):
- Proof of identity: Certified copy of your green barcoded ID or Smart ID card, or valid passport (if a foreign national).
- Proof of residential address (not older than 3 months): e.g., utility bill, rates account, bank statement, or lease agreement.
- Income tax number (SARS reference number).
- Contact details (phone, email).
- Marital status documents (marriage certificate / ANC contract if applicable).
If you are a foreign individual:
- Valid passport.
- Work permit/visa (if applicable).
- Proof of foreign residential address, and sometimes proof of local address if you have one.
- Tax compliance confirmation (if applicable).
- If you are buying through a company or close corporation (CC):
- Company/CC registration documents (CIPC).
- Resolution by the company authorising the purchase.
- Proof of address for the company’s registered office.
- Tax clearance certificate.
- ID and proof of address of directors/members.
If you are buying through a trust:
- Trust deed.
- Letters of authority from the Master of the High Court.
- Resolution by trustees authorising the purchase.
- ID and proof of address for all trustees and beneficiaries.
3. When FICA Compliance Happens
- Before the transfer process begins, the conveyancing attorneys will request all FICA documents.
- Estate agents are also legally required to FICA both buyer and seller before proceeding.
4. Consequences of Non-Compliance
- The transaction cannot proceed without FICA clearance.
- Banks will not release bond finance.
- Attorneys cannot lodge transfer documents at the Deeds Office until all FICA requirements are satisfied.
In summary:
When buying property in South Africa, you must provide proof of identity, proof of address, and tax details (plus extra documents if purchasing via a company, trust, or as a foreigner). FICA compliance is a legal requirement and ensures the safe and lawful transfer of property.