© Warona Lekoko, 2024
Founder
Trust (s1): fund consisting of cash or other assets administered & controlled by person acting in fiduciary
capacity, (donor)
q person (trustee) = appointed by agreement or under the will of deceased / deed of trust
q trustee = representative TP, responsible for all trust tax matters, but tax assessment still in trust’s name
Trusts are used to safeguards assets and for the purposes of BEL300, will be created by founders for the Donor
benefit of their children/relatives
To ensure a steady inflow of cash to provide for their maintenance, trustees manage assets bequeathed to
trust on behalf of spouse & children
Income is first taxed in the hands of the donor. If the donor isn’t taxed, then the BF. Lastly, if not the BF, then
the trust will be taxed Trust
Trust = person, but not entitled to s6 rebate or interest exemptions
YOA: 28/29 Feb
Trusts prepay taxes by way of provisional tax, but if they are trading trust which are a PSP, then PAYE
Beneficiaries
Testamentary (or mortis causa): created i.t.o. will – set up mainly for children/spouses
Living (or inter vivos): created during founder’s lifetime
Discretionary trust: trustees have power of discretion in the distribution income
Non-discretionary trust: trustees have no discretion (for example, the trust deed determines how income will be distributed)
Ordinary: …
Special: …
(a) If more than 1 BF, all must be disabled & relatives in relation to each other
Trust will cease to be a special trust in the YOA when (b) the youngest BF turns 18, (a) when all disabled beneficiaries die,
and (a & b) when the last BF dies
Special trust - par (a) Special trust - par (b) Ordinary trust
BF = suffers from mental illness or serious BF = relatives of deceased
Definition physical disability, preventing them from All BFs are alive/conceived, on date of founder’s death Other than special trust
earning income/managing own affairs The youngest BF <18 years old
Creation Living or Testamentary Testamentary Living or Testamentary
Tax rate Individual sliding scale 45%
Annual exclusion
PR exclusion
CGT PUA exclusion
40% 80%
(BEL300 Lecturers, 2022)
SALE DONATION BEQUEST
Seller: CGT Donor: CGT & donations tax Deceased: CGT & estate duty
Trust: Transfer duty Trust: Transfer duty
3 t 6
Founder
Trust (s1): fund consisting of cash or other assets administered & controlled by person acting in fiduciary
capacity, (donor)
q person (trustee) = appointed by agreement or under the will of deceased / deed of trust
q trustee = representative TP, responsible for all trust tax matters, but tax assessment still in trust’s name
Trusts are used to safeguards assets and for the purposes of BEL300, will be created by founders for the Donor
benefit of their children/relatives
To ensure a steady inflow of cash to provide for their maintenance, trustees manage assets bequeathed to
trust on behalf of spouse & children
Income is first taxed in the hands of the donor. If the donor isn’t taxed, then the BF. Lastly, if not the BF, then
the trust will be taxed Trust
Trust = person, but not entitled to s6 rebate or interest exemptions
YOA: 28/29 Feb
Trusts prepay taxes by way of provisional tax, but if they are trading trust which are a PSP, then PAYE
Beneficiaries
Testamentary (or mortis causa): created i.t.o. will – set up mainly for children/spouses
Living (or inter vivos): created during founder’s lifetime
Discretionary trust: trustees have power of discretion in the distribution income
Non-discretionary trust: trustees have no discretion (for example, the trust deed determines how income will be distributed)
Ordinary: …
Special: …
(a) If more than 1 BF, all must be disabled & relatives in relation to each other
Trust will cease to be a special trust in the YOA when (b) the youngest BF turns 18, (a) when all disabled beneficiaries die,
and (a & b) when the last BF dies
Special trust - par (a) Special trust - par (b) Ordinary trust
BF = suffers from mental illness or serious BF = relatives of deceased
Definition physical disability, preventing them from All BFs are alive/conceived, on date of founder’s death Other than special trust
earning income/managing own affairs The youngest BF <18 years old
Creation Living or Testamentary Testamentary Living or Testamentary
Tax rate Individual sliding scale 45%
Annual exclusion
PR exclusion
CGT PUA exclusion
40% 80%
(BEL300 Lecturers, 2022)
SALE DONATION BEQUEST
Seller: CGT Donor: CGT & donations tax Deceased: CGT & estate duty
Trust: Transfer duty Trust: Transfer duty
3 t 6
