Going once, going twice, Sold!

Liabilities that your estate could potentially be liable for at your death include the following:
• Liabilities – any debt that is still owing to creditors (home loans, vehicles loans, etc.)
• Estate duty – is payable on the estate of every person who dies and whose nett estate is in excess of R3.5 million. It is charged at the rate of 20% and 25% for estates of more than R30 million.
• Capital Gains Tax (CGT) – upon death, a CGT event is triggered and therefore you may be liable for CGT on certain assets, e.g. rental property.
• Executor’s fees – an amount that your elected executor will receive for their role in assisting in winding up your estate. Usually calculated at 4.02% (3.5% + VAT) of your gross estate.
• Cash bequests – any specific cash bequests to heirs as stated in your Last Will and Testament.
• Income Tax – an income tax liability based on your last return.
• Accrual claim – an accrual claim may arise if one is married out of community of property (ANC).
• Funeral expenses – ranging from R 20 000 to R 50 000
• Master’s fees – the fee charged by the Master of the High Court, approximately R600.00.
Life cover is one of the most efficient and cost-effective ways to make provision for liquidity. We do however often see individuals with life cover amounts that hasn’t been justified at all. It is therefore critical that a detailed calculation be done to determine your liquidity needs for your unique situation. As this can be very complicated you should get a suitably qualified professional to help you.

Heinrich Coomans | CA(SA) | CFP ® is ‘n director at Affluence Group and spesialises in Investments, Personal and Business Insurance. For any questions please contact him at heinrich@afgroup.co.za or 084 586 9509