TAX CONSEQUENCES OF THE DECEASED & DECEASED
ESTATES
If a natural person dies there are effectively 3 tax calculations to be done:
1. Natural person’s last income tax calculation (1 March to date of death).
2. Estate’s income tax calculation (date of death until he estate is finalised. This could
be one or more years of assessment).
3. Estate Duty calculation.
IT calculation from 1 March to date of Estate duty calculation
death Executor responsible for both
CGT = deemed disposal on date of death the last IT return and estate
[s 9HA] duty calculation.
s 6 rebate(s) x y/365 days IT liability (including CGT) could
If would have been 65/75 still be deducted in the estate duty
qualifies for the secondary/tertiary calculation.
rebate. If assets are sold from estate in
s 6A & 6B credit for medical order to settle debt, CGT will
scheme (deceased gets benefit arise in estate. Estate treated
even if estate makes the final as if a NP (tax rates, CGT
payment). annual exclusion & inclusion
How will the age of dependents be rate).
determined for medical purposes? Estate does not qualify for
s 10(1)(i) limits are not rebates and credits (s 6 and s
apportioned! 6A and s 6B) [see s 25(5)].
CGT annual exclusion: R300 000
s 9HB(2)(a) might apply.
What are deemed to accrue immediately prior to death?
Section Detail
s 8C(3)(b)(iv) Death = vesting event, deemed to vest immediately before death takes
place.
par 3, 3A & 4 of Lump sum from PF, PPF, PrF, PrPF and RAF are deemed to accrue
the 2nd Schedule immediately prior to death.
par (d) of Gross Severance Benefit due to death is deemed to accrue immediately prior
income s 1 to death.
s 9HA(1) Deemed disposal over assets at market value on date of death
(exclusions?) (See s 9HA(1)(a) to (c))
s 9HB(2)(a) Deemed disposal immediately before the date of death to surviving
spouse if spouse has a claim under section 3 of the Property
Matrimonial Act.
ESTATES
If a natural person dies there are effectively 3 tax calculations to be done:
1. Natural person’s last income tax calculation (1 March to date of death).
2. Estate’s income tax calculation (date of death until he estate is finalised. This could
be one or more years of assessment).
3. Estate Duty calculation.
IT calculation from 1 March to date of Estate duty calculation
death Executor responsible for both
CGT = deemed disposal on date of death the last IT return and estate
[s 9HA] duty calculation.
s 6 rebate(s) x y/365 days IT liability (including CGT) could
If would have been 65/75 still be deducted in the estate duty
qualifies for the secondary/tertiary calculation.
rebate. If assets are sold from estate in
s 6A & 6B credit for medical order to settle debt, CGT will
scheme (deceased gets benefit arise in estate. Estate treated
even if estate makes the final as if a NP (tax rates, CGT
payment). annual exclusion & inclusion
How will the age of dependents be rate).
determined for medical purposes? Estate does not qualify for
s 10(1)(i) limits are not rebates and credits (s 6 and s
apportioned! 6A and s 6B) [see s 25(5)].
CGT annual exclusion: R300 000
s 9HB(2)(a) might apply.
What are deemed to accrue immediately prior to death?
Section Detail
s 8C(3)(b)(iv) Death = vesting event, deemed to vest immediately before death takes
place.
par 3, 3A & 4 of Lump sum from PF, PPF, PrF, PrPF and RAF are deemed to accrue
the 2nd Schedule immediately prior to death.
par (d) of Gross Severance Benefit due to death is deemed to accrue immediately prior
income s 1 to death.
s 9HA(1) Deemed disposal over assets at market value on date of death
(exclusions?) (See s 9HA(1)(a) to (c))
s 9HB(2)(a) Deemed disposal immediately before the date of death to surviving
spouse if spouse has a claim under section 3 of the Property
Matrimonial Act.
