South African Inheritance Claims
Scenarios for South Africans living overseas.
As a South African residing overseas, you likely fall into one of the following scenarios:
- You have assets remaining in South Africa (such as real estate, shares, pensions, or policies) and you want to ensure your wishes regarding these assets upon your death outside South Africa are properly addressed.
- You have been designated as the beneficiary of an inheritance from a deceased estate with assets situated in South Africa.
Scenario 1: Managing a deceased estate in South Africa from overseas.
If you pass away outside South Africa, the handling of your South African assets is governed by the South African Administration of Estates Act 66 of 1965. This means that your South African estate must be formally registered and managed in accordance with South African law.
- The proceeds from your estate can be disbursed to your designated beneficiaries overseas, and your assets can be administered in accordance with your will.
- While it is generally advisable to draft a will in the jurisdiction where your assets are located, it is possible to create a single will that addresses assets worldwide, streamlining the administration process.
- Estate duty is applicable to and payable by your estate and is assessed at a rate of 20% on the dutiable estate value up to R30 million and 25% on the portion of the dutiable estate exceeding R30 million.
- There is no tax on inheritance payable by a beneficiary of an estate in South Africa.
Scenario 2: Claiming a South African inheritance from overseas
Claiming an inheritance from a South African estate while residing overseas involves the following process:
Inheritances from South African estates, whether for resident or non-resident private individuals, non-resident entities, and/or trusts, can be remitted abroad. To facilitate this, the bank handling the transfer will require the Liquidation and Distribution Account along with the Master of the High Court reference number.
It’s crucial to emphasize that all inheritances must initially be deposited into a South African bank account under the beneficiary’s name. Only after the funds are cleared in this account can they be authorized for remittance offshore.
Will you have to pay tax on inheritance in South Africa?
Inheritances from South Africa are generally not subject to tax for the beneficiaries. Estate duty is typically paid by the estate of the deceased, ensuring that the distributions to beneficiaries remain tax-free.
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