What is a Rates Clearance Certificate? (RCC)

A Rates Clearance is a certificate provided by the relevant local authority on application by a conveyancer to transfer a property. This document certifies that there is no current outstanding debt due by the seller on the property. The Registrar of Deeds may then pass transfer on the property and registration in the purchaser’s name may go ahead.

What is the law?

The Deeds Registry Act prohibits the Registrar from passing transfer of a property without a Rates Clearance certificate. Section 118 of the Local Government: Municipal Systems Act, 2000 (Act No. 32 of 2000) states: “118(1)A registrar of deeds may not register the transfer of property except on production 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. 1(A) A prescribed certificate issued by a municipality in terms of subsection (1) is valid for a period of 30 days from the date it has been issued

How does the rates clearance process work?

(OLD WAY APPLICATION)The appointed conveyancer will apply to the relevant local authority to issue the “Rates Clearance figures”. These figures are a breakdown of the outstanding debts. The conveyancer will request this outstanding amount from the seller. Once all outstanding and assessment amounts have been paid by the seller a Rates Clearance certificate will be issued to the purchaser.

(NEW WAY APPLICATION) The City of Tshwane is now able to issue Rates Clearance Memos and Certificates(RCC's) via the E-Tshwane platform. The process is the same as the old way application just everything is done online. If a conveyancing attorney in not registered for the online platform then they have to register first at the Municipality of there area.

Requirements: Applying for Rates Clearance Figures (MEMO)

The following documents need to be attached for a full application:

· Application form completely filled in

· Deed search

· ID copy of buyer and seller

· Rates and services account (water and electricity)

· Proof of water and electricity if not with Tshwane Municipality

· Proof of water and electricity if with Tshwane municipality (photos of water and electricity reading). If the client only has 1 of the 2 then just a photo of the specific meter an if it is bulk meter then no need for photos ( because bulk is for the body corporate not the client)

· Power of Attorney letter ( this is only for the Municipality to cover themselves if a client is inquiring about the transaction). The Power of Attorney Letter in the agreement between the client and the Attorneys.

Applying for Rates Clearance Certificate

Proof of payment for the clearance figures must be handed in at the municipality with the clearance figures. The municipality can not and will not issue a certificate without the proof of payment and if the payment is not reflecting on the system. a Payment can take 2 - 5 working days to reflect on the system. The reason for presenting the proof of payment is because the municipality can argue the fact that anyone could have made a wrong payment.