NHBRC Fees – No VAT Attached
The NHBRC has Deregistered from VAT and Adjusted their Fees
We have recently had a number of enquiries about how the NHBRC fees are calculated, those are the fees that have to be paid when a proposed new house is registered with them.
In 2011 the NHBRC was deregistered for VAT and they adjusted their registration fees accordingly.
Registration with the NHBRC
Every new home built in South Africa, since December 1999, must by law be registered with the NHBRC. No bank or home loan institution may lend money against the security of a mortgage bond unless the house is registered with the NHBRC. In addition to this the builder must be qualified, certified and registered with the NHBRC as well.
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NHBRC Fees
In another article, NHBRC Suspends the Payment of House Enrolment Fees-PA003 we highlighted how the NHBRC is no longer allowing the NHBRC fees to be bundled together with the first draw that the home owner gets from the financial institution – referred to as the PA003. This now has to be done at the time of registration or the house will not be accepted onto the NHBRC’s system.
As at the 1st April 2014 the NHBRC increased their residential house enrollment NHBRC fees by 14%. This increase only applies to non-subsidy enrolments including late inspection fees. Here are their published figures:
Here is a breakdown of how the fees are calculated. These are the older figures and we have left them in this post as they will give you an idea (on the right hand side) how the NHBRC goes about their calculations for the NHBRC fees that they charge. We do advise you to check with your local NHBRC office for the most up to date figures. This table will give you a good idea as to how they have structured the fees and what you can expect to pay.
NHBRC ENROLMENT FEE SCHEDULE excl VAT
Why the NHBRC in South Africa Does Not Charge VAT?
The National Home Builders Registration Council (NHBRC) in South Africa is a government agency that is responsible for regulating the home building industry and promoting quality home construction in the country. As a government entity, the NHBRC is exempt from paying value-added tax (VAT) on the services it provides.
In South Africa, government entities are generally exempt from paying VAT under the Value-Added Tax Act, 1991 (Act No. 89 of 1991). This means that the NHBRC, as a government agency, is not required to charge VAT on its services.
The purpose of this exemption is to avoid the government having to pay VAT on goods and services that it purchases, as well as to prevent double taxation of government entities. This helps to reduce the cost of government services and ensures that public funds are used efficiently.
It’s worth noting that this exemption is specific to government entities and does not apply to businesses or individuals. If a private home builder or contractor provides services that are subject to VAT, they would be required to charge and remit VAT to the South African Revenue Service (SARS) in accordance with the country’s tax laws.
I think that is a question that the NHBRC should answer. The link to their website is: http://www.nhbrc.org.za
Good day ,
Could you give me the reason as to why the enrolment fee is calculated on the cost of the land /plot plus the cost of building the new dwelling & not only on the building cost .
Awaiting your reply
Lynette
At the end of the day it is the home owner that pays the fees as a guarantee on his new house. You can have an agreement with the builder that he pays the fees and you then pay him back included in the building quote. The NHBRC will no longer allow the fees to be paid from the first bond draw from the bank, read here: nhbrc-suspends-fees-included-pa003 What the NHBRC covers is in this post here: nhbrc-qas
Good day,
Please can you assist. We are currently building a house to the value of R1 350 000, please can you advise what the fees is that the builder should charge for NHBRC?
Hi, I would like to find out who pays the NHBRC fees and what do they cover..pleas assis me/
Hi Janek
Please note that the NHBRC has increased their enrolment fees by 14% on the 1st of April 2014. The fees however remain excluding VAT
Hi Ed
We are NHBRC Consultants assisting builders/developers/homeowners with all NHBRC related matters.
1. It the house was built prior to 1998 – NO NHBRC is required
2. Selling price is defined by the NHBRC as building contract price + land price. as the house will be enrolled under your builders name this is seen as his “selling price” to you. It is a bone of contention at the moment as financial institutions demand that the enrolment price be uplifted to the selling price once you sell the house to another person. In a case like this I suggest that you include a clause in the sale agreement that if your buyers bank wants the certificate uplifted that it will be for the buyers account
3.Please see our discussion group on LinkedIn regarding Owner Builder Exemption – My advice to you is NOT to go this route as it will cause endless problems later on when you want to sell the house
Hi SBONELO, We do not do registrations. You must go to the NHBRC website Click Here nhbrc.org
HI I WANT TO REGISTER MY CONTRACTION COMPANY WITH YOU NHBRC BT I WANT TO KNOW HOW LONG OR HOW MANY DAYS DOES IT TAKE TO GET MY NHBRC CERTIFICATE AFTER I REGISTERED MY COMPANY
The NHBRC says that the fees are based on “selling price”.
We have received two confliction pieces of information.
The source said that the selling price includes the price of the land and the other one said it is for the building only. This makes quite an impact on the total fee.
I personally do not understand what the cost of the plot would have to do with the fee, since they are only covering the building. But one never knows…
Ed, First off, I don’t think my husband who is co-author of Owner Building will appreciate being called a lady! LOL
Secondly, unfortunately things like VAT and other numbers do change. We update as often as the publisher sees fit.
But to answer your NHBRC questions:
1. If the house was built pre-NHBRC it would not be enrolled. End of story.
2. I assume that you paid your contractor for the fees due to the NHBRC – in which case your question should be addressed to the contractor. It is the contractor’s responsibility to pay these fees, not the owner’s.
3. The NHBRC has forms that you will need to fill in when you apply for an exemption, and you need to prove that you own the property. They will email them to you if you phone and them and ask them to do so. You will though still need a competent person to draw up your plans and submit these to the local authority for you, and follow through on the build.
Hi Ladies
I recently purchased your informative book “Owner Building in South Africa”. I am busy perusing various sections and realize that some info is out of date eg vat turnover R1m changed to R3m page 37, similarly the reference to capital gains. I’m sure this will be picked up in due course. My queries at this stage are related to the NHBRC as follows:
1. I own an existing house which I purchased in 1990 (pre NHBRC). If I was to sell this house at any stage presumably it would have to be NHBRC enrolled? If so, who pays the buyer or the seller.
2. Secondly I built a house in 1994 and paid the NHBRC premium which was based solely on the building contract amount. (although I took great exception to the fact that this included fittings & furnishing allowances). To rub salt into the wound I am now told that the premium must now include the price of the land as well (relating to point 3 below). I have searched the NHBRC website but can’t find the definition of “selling price” or the amount on which the premium is calculated. Do you know where I can find a definition.
3. I recently purchased some land and am considering the owner-building approach. How does one obtain NHBRC exemption which seems to be an option from your book, when I am the person responsible for artisan recruitment etc.
Many thanks
Ed Hill
Patrick then this is probably true – because the bylaws all vary. It is not something that is covered by the National Building Regulations. NB BYLAW vs LAW. There are also certain places that require a beetle certificate before they will do the transfer. Perhaps you can check this with IOPSA. They should know about all aspects of plumbing in the different regions.
I understand, reason for my question is because we were told that the COC for plumbing is only compulsory in Cape Town. The house will not be registered in Gauteng unless it has COC for electricity, it is not the case with the COC for plumbing.Thanks, is it true that it is not a law “yet” in Gauteng, I mean the compulsory COC for plumbing?
Kirsty the NHBRC website does seem to go on the blink now and then – just keep trying. It’s working today!
You can’t claim against the NHBRC itself. However the NHBRC has a warranty scheme for people who have built using NHBRC-registered builders – and they will cover certain things including leaking roofs. Your builder should have been registered with the NHBRC, in which case you may be able to put in a claim – however only if you can prove a structural defect which has a five-year period in which you can claim. Unfortunately you have to claim against leaking roofs within the first year.
Patrick all plumbing should be certified, whether after the initial installation or when new work is done – e.g. if an electric water heater is replaced or if a solar water heating system is installed. Generally COCs are issued for any plumbing work that is valued at over R1500. It is generally given to the owner, the local authority and sometimes an insurance company (if the work was done as part of an insurance claim). Only qualified, registered plumbers can issue COCs. Remember, too that it is illegal for any person who works on plumbing installation if he/she is not a qualified plumber or not working under the adequate supervision of a qualified plumber.
So if one is selling a house, there should be an existing COC that a buyer could call for.
Is the COC for plumbing compulsory when selling a house?
Gerrit please contact the NHBRC. We don’t have anything to do with them.
H Gerrit,
You are at the best website in South Africa for Building Regulations but we do not do registrations, you have to go to the NHBRC website: http://www.nhbrc.org/
They sometimes do have problems with the site so just keep trying. You must come back here if there is anything you need to know about the Regulations.
Would like to regester for NHBRC.
Plaese let me now what I need to do please and sent me all nececerly dokument to fill out please/
Thanks Gerrit
Elger Projects.
Hi, I’ve tried the NHBRC website but that appears to be out of order. We’re living in a house that has been leaking ever since building completion +-4 years ago, we have tried various waterproofing solutions but to no avail. A friend has now said that I should claim against the NHBRC but I do not know if this is possible or how I would go about doing that. Do you perhaps have any suggestions? Thanks!
Hi, You are on the wrong website. You need to go to the NHBRC.org
we did regester but our problame to renew a certficate
Hi Johannes, You must contct the NHBRC directly on Toll Free No. 0800 200 824, or go to their website http://www.nhbrc.org/
Good day Sir/Madam
My company was once registered with nhbrc in a different name.I have registered the present company because the other name was not marketable for some reason,now I would like to continue using the old nhbrc registration number instead of registering a new one.Please advise me which steps I must follow thanks.
Yours Faithfully
LJ Maheso
mahesoconstruction@gmail.com