Estate Duty

[Craig Dlamini]

Good day All,

I trust you are well.

I have a query. My client has a large estate, say +-R40 Million, now on passing the client will receive an abatement of R3 500 000 from SARS. The Client does not have any liabilities nor life insurance. Thus has no allowable deductions. With the above being said she will be taxed 20% on R36.5 million. Any ideas on how I can somewhat bring this down? I am literally grasping at straws here.

Any help will be highly appreciated

Thank you in advance

[Krono9]

no spouse?

[Andromeda]

Forgive me for being blunt, but she won't receive any abatement, her estate will.

There are no allowable deductions because estate duty is levied on the value of the estate, not it's income. So, in the absence of assets in a trust, this can't really be reduced.

[Craig Dlamini]

no spouse?

She has no spouse


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[Craig Dlamini]

Forgive me for being blunt, but she won't receive any abatement, her estate will.

There are no allowable deductions because estate duty is levied on the value of the estate, not it's income. So, in the absence of assets in a trust, this can't really be reduced.

The net value of all her assets as at current stand at 40 million we are waiting on a few valuations. The residence alone is valued at around 20 million. She has other properties as well. The income tax act says on passing items such as her liabilities are settled first from funds in the estate but that’s the issue she doesn’t have any liabilities that will impact the total estate value


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[Andromeda]

Correct. Duty is paid on the net value of the estate. Once you have inventorised the estate then here is nothing more you can do.

[Craig Dlamini]

Correct. Duty is paid on the net value of the estate. Once you have inventorised the estate then here is nothing more you can do.

I was thinking what if she enters into a large building contract or just incur large sums of liabilities wouldn't that help? although the next question would thus be what type of liabilities will have to be?

but yes I've looked through the Act and it doesn't seem like theres much available to her