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Last Will and Testaments
By: Ilse de Klerk
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 |
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