[Question] Disability tax rates on trusts

[DylanPetzer]

Hi there,

Is there anyone that can advise me on the taxation rates for a special trust that where the Main Beneficiary is Disabled?

How to apply for such rates?
What are those rates?
Advantages?
Disadvantages?

Thanking you in advance!

[Andromeda]

Hello Dylan

As far as I know the tax rates for a special trust are the same as for a natural person.

In your instance, a disabled beneficiary would be entitled to a refund of expenses directly related to the disability, but the tax rate itself is not affected. Again, to the best of my knowledge.

[GerhardvS]

There is no special tax rate for any trusts. All trusts, no matter what is taxed at 41%.

The individual qualify for disibilty rebates, 6B, in regards to his medical costs.

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[Andromeda]

Hi Gerhard

Special Trust Type A – a trust created solely for the benefit of a person(s) with a “disability”, as defined in section 6B(1), where the disability makes it impossible for the person(s) from earning enough money for their care or from managing their own financial matters.

Special trusts are taxed at a sliding scale from 18% to 45% (same as natural persons).

See http://www.sars.gov.za/ClientSegment...-of-Trust.aspx

As far as I know ordinary trusts are presently taxed at 45%