Page 50 - Nexia SAB&T Estate Planning Guide 2024

the extent that such debts exceed the value of the deceased’s assets
situated outside South Africa which have not been included in the
dutiable estate.
u Bequests to certain public benefit organisations
» Where property is bequeathed to a public benefit organisation or
public welfare organisation, which is exempt from income tax, or to
the State or any local authority within South Africa, the value of such
property will be able to be deducted for estate duty purposes.
u Property accruing to a surviving spouse [Section 4(q)]
» This includes so much of the value of any property included in the
estate that has not already been allowed as a deduction, and accrues
to a surviving spouse.
» The phrase “accrues to a surviving spouse” means that it is not limited
only to property bequeathed to the spouse in the deceased’s Will,
but any other property that accrues to the surviving spouse on the
deceased’s death, such as the proceeds of life insurance payable to
the spouse as beneficiary, or any annuities that may accrue to the
surviving spouse.
» Note that proceeds of policy payable to surviving spouse is required
to be included in the estate for estate duty purposes (as deemed
property), however are deductible in terms of Section 4(q).
» Section 4(q) will not be granted where the property inherited is
subject to a bequest price.
» Section 4(q) will not be granted where the bequest is to a trust,
established by the deceased for the benefit of the surviving spouse,
if the trustee(s) has a discretion to allocate such property or any
income there from to any person other than the surviving spouse
(a discretionary trust). Where the trustee(s) have no discretion as
regards to both the income and capital of the trust, the Section 4(q)
deduction may be granted (a vested trust).
» It is important to plan for the liquidity in the estate of the surviving
spouse, to provide for possible capital gains tax and estate duty
liability.

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