Page 53 - Nexia SAB&T Estate Planning Guide 2024

n and the return(s) for the deceased estate are submitted to the South African
Revenue Service.
n There are therefore two types of assessments that must be taken into
account, namely:
u the pre-death assessment (assessing the income and deductions
applicable to the taxpayer to date of death), and
u the post-death assessment (assessing the income and deductions
applicable to the deceased estate after date of death).
Specific Income Tax Considerations
n The provisions of Section 25 of the Income Tax Act (no.58 of 1962) were
amended, with effect from 1 March 2016, and apply to persons dying on or
after that date.
n The amended provisions state that any income received or accrued to the
deceased estate post death, which would have been income in the hands of
the deceased, had he received it before he died, must be treated as income
of the deceased estate regardless of who inherits the income (previously
such income was taxed in the beneficiary’s hands). The deceased estate
therefore is required to account for all its income until the Liquidation and
Distribution account is finalised. The deceased estate will qualify for the
annual interest exemption.

Income Tax and Estate Planning
n The estate planner needs to evaluate the impact of income tax on his estate
plan, and it is advisable for him to consult with his professional adviser for
further information on this.
Capital Gains Tax: General
n Capital gains tax was implemented on 1 October 2001.
n It is triggered by the disposal on or after valuation date of any asset of a
South African resident, irrespective of where in the world the asset is held,
and certain assets of a non-resident.
n Assets include property of whatever nature, whether movable or immovable,
corporeal or incorporeal, except for currency (with the exception of gold and
platinum coins).
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