RI FINANCIAL MANAGEMENT SERVICES

Registered Financial Services Provider


Blog detail


Last Will and Testaments

By: Ilse de Klerk


Oops

Last Will and Testaments

It is important for any person over 18 who has assets or debt to document their wishes regarding what should happen to their assets in the event of their death.

All estates must be reported to the Master’s Office. Estates of less than R250 000, the Master may issue an authority letter to a person to settle the estate. Estates over R250 000, the Master will issue a letter of executorship.

If there is no valid last will and testament for the deceased, then the estate is ‘interstate succession’ and must be distributed according to the law of interstate succession.

Duties of the executor.
The executor will be representing the deceased, ensuring that all accounts, dept, and taxes are paid, and then to execute your wishes.

To mention some estate payments:
Accounts - Cell phone cancellation fees
Debts
Masters Fee
Capital Gains Tax – CGT
Executors fees
Estate Duty – current tax rebate is R3.5Mil – First R30 mil will be taxed at 20% and over R30 mil, taxed at 25%
Property Transfer Fees
Accrual Marriage Claim
Maintenance Claims
Business loans and surety

It is therefore important to have a financial plan in place and reviewed when there are changes in your life.

It is important to use insurance to pay for estate fees and to align your insurance and investments to your last will and testament wishes.

Basic example to make the costs more of a reality:

Assets

 

 

 

Fixed Assets – House and vehicles

R2 300 000

 

Bank Investments

R   100 000

 

Investments

R   500 000

 

Life cover with no beneficiaries

R2 000 000

 

 

R4 900 000

Liabilities

 

 

 

Estate Advertisements

R100

 

Estate Bank account charges

R300

 

Courier, postage and petties

R500

 

Assets Valuation fees

R3 000

 

COC – Electricity, Gas and Solar fees

R5 000

 

Property Rates, Taxes and Levies
     3 Months pre-paid municipal rates

R15 000

 

Attorney Transfer Costs

R30 000

 

Maintenance claims

 

 

Cash bequeaths

 

 

Accounts debt payments

  Credit cards and clothing accounts

R100 000

 

 

Outstanding personal SARS

R20 000

 

CGT for assets not to spouse – CGT 18%

R360 000

 

 

R533 900

 

Estate value

R4 366 100

 

Estate duty – Rebate R3 500 000

R866 100

 

Estate Duty Tax 20% of R

R173 220


Estate less payments, mentioned above – R4 192 880

If there is not enough cash in the estate to pay the example expenses, then the executor must find the funds from either:
Selling the assets
Beneficiaries must provide the funds

Thus again, death planning/estate planning is an important part of your financial planning.