SARS Estate Duty : South African Revenue Service

Organisation : South African Revenue Service (SARS)
Facility Name : Estate Duty
Country : South Africa
Website : https://www.sars.gov.za/types-of-tax/estate-duty/

What is SARS Estate Duty?

Estate Duty is levied on the worldwide property and deemed property of a natural person who is ordinarily resident in South Africa and on South African property of non-residents. Various deductions under section 4 of the Estate Duty Act, 1955 are allowed to determine the net value of the estate. An abatement of R3.5 million is allowed against the net value of the estate to determine the dutiable value of the estate. The Estate Duty is levied on the dutiable value of an estate at a rate of 20% on the first R30 million and at a rate of 25% on the dutiable value of the estate above R30 million.

Related / Similar Facility : SARS Dividends Tax

Who is Liable For Estate Duty?

It is normally the responsibility of the Executor to pay the duty as levied on the property of the deceased. However, there are instances in which the estate duty is payable directly by the person who is receiving the property. For example, where a policy is payable directly to a beneficiary, the Estate Duty attributable to such policy is payable by the beneficiary (in other words, this portion of the Estate Duty will not be paid by the deceased estate).

How To Report a Deceased Estate To SARS?

Even if Estate Duty is not payable you have to inform SARS that the person is deceased.

There are two options at this stage to report a new Estate Case to SARS:
** By sending an email to the SARS email addresses or
** by sending it through the new SARS Online Query System.

In order to report a new Estate Case to SARS, it is important that the correct Supporting Documentation be submitted to SARS. Refer to our FAQ on what is required to report the new Estate to SARS.

FAQ On SARS Estate Duty

Frequently Asked Questions FAQ On SARS Estate Duty

Can the executor be held personally liable for estate duty?
The executor is personally liable for the estate duty payable in his or her representative capacity if:
** The estate duty liability remains unpaid and the executor disposes of the amounts in respect of which the estate duty is due; or
** an executor disposes of funds that he or she possesses in a representative capacity or that came into his or her possession after the estate duty liability is due and the funds could legally have been applied to settle the estate duty liability.

An exception to the general rule is that an executor cannot be held personally liable for the estate duty liability in respect of an asset over which the executor had no control.

When is Estate Duty due?
Estate Duty is due within 1 year of date of death or 30 days from date of assessment, if assessment is issued within 1 year of date of death. Currently, interest is levied at 6% p.a. on late payments.

Who is responsible for collecting Estate Duty?
SARS is responsible for collecting the Estate Duty. For more information on Estates, please refer to the Estates webpage.

How do I declare Estate Duty?
The executor will calculate the Estate Duty payable when preparing the liquidation and distribution account. The executor must complete the Estate Duty Return (Rev267) and must submit the return, together with the liquidation and distribution account to the Master of the High Court as well as to SARS.

When can the DEC letter be requested?
The DEC letter may be requested only once all outstanding returns are submitted, assessments are issued, tax liabilities/refunds are paid. If the DEC letter is requested prior to the tax obligations being fulfilled, it will not be issued and will have to be requested again once all the obligations have been fulfilled.