Deceased Estates & Wills
Focus on the reporting and administration of deceased estates, estate planning, ante-nuptial contracts, and wills.
THE LIQUIDATION & DISTRIBUTION ACCOUNT, COSTS AND TRANSFER OF PROPERTY FROM A DECEASED ESTATE
For most people the costs and transfer of property in a deceased estate is a mystery. When grieving the loss of a loved one, mathematics and finer detail is the last thing to occupy one’s mind. The Liquidation & Distribution account will be discussed first and thereafter the costs and transfer of property.
Liquidation & Distribution account: The primary goal of this account is to give a true reflection of the deceased’s affairs to the Master of the High Court. It lists all the assets (property, movable assets, policies and investments) as well as the liabilities (loans, clothing accounts etc.) in the estate.
Costs of the estate: When one refers to the costs in an estate it includes the executor’s fee (the fee an attorney is entitled to); the Master’s fee and all other administration costs in the estate. Currently the executor’s fee is calculated at 3.5% of the total assets in the estate as well as 14% VAT on the 3.5% if the attorney is registered for VAT purposes. If the total assets in the estate amount to R1 500 000.00 the executor’s fee is calculated as follows:
R1 500 000.00 x 3.5% = R52 500.00
R52 500 x 14% = R7 350.00
The total fee will therefore be R59 850.00
Transfer of property in an estate: If the deceased owned property at the time of death, such property needs to be transferred either through a bequest in a will or according to Intestate Law. If they were married and owned the property with their spouse the deceased will be owner of 50%, if married in community of property. When somebody dies, the 50% must be transferred to the spouse and, or the deceased’s children. If the deceased was the sole owner of the property, then the Will determines what happens to the property, or it will be divided amongst the deceased’s wife and children in case of dying without a will. There are transfer costs linked to this property transfer. Such costs are calculated on the value of the property, will be set out in a cost quotation, and will be included in the liabilities of the estate in the Liquidation & Distribution account.
Why have a will?
The best way to ensure that after your death your assets are distributed according to your wishes and instructions, is to draw up a will. This gives you the opportunity to appoint an Executor to deal with your assets. If you die without a valid will, your family might suffer inconvenience and even severe hardship.