Page 49 - Nexia SAB&T Estate Planning Guide 2024

D Deductions
n The dutiable value of the estate can be considerably reduced by claiming all
the deductions for which the estate planner qualifies.
n Some of the most important allowable deductions are:
u The cost of funeral, tombstone and death bed expenses
u Debts due at date of death to persons who have their ordinary
residence in South Africa
» To the extent to which these debts are to be settled from property
included in the estate.
» This includes the deceased’s income tax liability (which includes capital
gains tax) for the period up to death.
» It is important to note that the deduction is such that the liability must
be actually discharged before it is taken into account. Where there is
a bequest price obliging an heir to settle an amount in order that he or
she may inherit – for example an heir inherits fixed property provided he
or she pays the bond thereon, then the bond amount (liability) will not
be allowed as a deduction.
u Costs of administration and liquidation, and expenses incurred during
the administration of the estate
» Includes executor’s remuneration, Master’s fees, costs of transferring
assets (conveyancing fees), and costs of advertising the estate.
u Foreign assets and rights
» The general rule is that foreign assets and rights of a South African
resident, wherever situate, are included in his estate as assets.
» However, the value thereof can be deducted for estate duty purposes
where such foreign property was acquired before the deceased
became ordinarily resident in South Africa for the first time, or was
acquired by way of donation or inheritance from a non-resident, after
the donee became ordinarily resident in South Africa for the first time,
(provided that the donor or testator was not ordinarily resident in
South Africa at the time of the donation or death). The amount of any
profits or proceeds of any such property is also deductable.
u Debts and liabilities due to non-residents
» Debts and liabilities due to non-residents are deductible, but only to

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