Page 50 - Nexia SAB&T Property & Tax Guide 2022

ESTATE DUTY

The general rule is that if the taxpayer is ordinarily resident in the Republic at the time of
death, all of his assets (including deemed property), wherever they are situated, will be
included in the gross value of his estate for the determination of duty payable thereon. Estate
duty is levied at 20% on the first R30 million of the dutiable estate. Estate duty will be levied
at 25% on the dutiable estate in excess of R30 million. Estate duty is levied on the South
African property of non-residents.
Deemed property includes insurance policies on the life of the deceased, claims in terms of
the matrimonial property act as well as property that the deceased was competent to dispose
of immediately prior to his death.
The most important deductions are:
◆ Debts due at date of death
◆ Bequests to public benefit organisations
◆ Bequests to a surviving spouse
The Act allows for a R3.5 million estate duty abatement. This abatement could rollover
from the deceased to a surviving spouse, so that the surviving spouse can use a R7 million
abatement on death. The portability of the deduction will apply to the extent that the first
dying spouse did not use the whole abatement.
There is relief from Estate Duty in the case of the same property being included in the estates
of taxpayers dying within ten years of each other. The deduction is calculated on a sliding
scale varying from 100% where the taxpayers die within two years of each other and 20%
where the deaths are within eight to ten years of each other.
Executor’s remuneration
An executor is entitled to the following remuneration:
◆ The remuneration fixed by deceased in the will, or
◆ 3.5% of gross assets
◆ 6% on income accrued and collected from date of death
Executor’s remuneration is subject to VAT where the executor is registered as a vendor.

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