Page 13 - Nexia SAB&T Trust Guide 2022

■ Business/Trading Trusts: These are inter vivos trusts formed to carry on the
business with a profit incentive. The trustees should be independent of the
beneficiaries. Business Trusts:
◆ May be either public or private.
◆ Beneficiaries enjoy limited liability trading.
◆ Administration is less complex and less expensive than a company or
close corporation.
■ Trustees may each individually face personal liability in the event of
recklessness or failure to exercise reasonable care and skill.
■ Charitable Trust: This is a trust set up for charitable purposes and may
qualify for exemption from income tax and Capital Gains Tax provided that:
◆ It carries on an approved public benefit activity.
◆ It is registered as a Public Benefit Organisation by the SARS Tax
Exemption Unit.
◆ Donations to a charitable trust which fulfils the regulatory requirements
will also be exempted from donations tax.

All trusts need to register with SARS.
A trustee is the representative taxpayer of a trust.

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