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February 2018 was quite an important month in the lives of all South Africans. With all the happenings in our Parliament, we are hoping for a brighter future for our beautiful country. It is inevitable though, to realize that our new President is facing a huge, daunting task to get the country back in shape. It will probably be an uphill battle and we can only hope that the appointment of his own cabinet will leave him in a position of strength as they hold up his arms and support him with all the challenges that lie ahead. In the mean time we have full confidence in the abilities of the country’s leader to do the right thing for áll the people of South Africa.
A cash shortfall in an estate can cause hardship to your next-of-kin. In the next edition we will have another look at this matter.
CASH SHORTFALL IN AN ESTATE
….. Read more in the upcoming edition!
DELAYS IN FINALIZING AN ESTATE
Dealing with and finalizing an estate is a delicate and emotional process that most people would like to wrap up as painlessly and as quickly as possible. However, that is not always the case. Sadly, it can turn into a time-consuming endeavour, taking months or even years to conclude.
Many institutions and people are involved in the winding up of a deceased estate – the Executor, the Master of the High Court, SARS, the heirs, banks and insurance companies, to name a few – and delays can arise during any part of this process.
It is therefore wise to make use of Legatus Trust’s services as a reputable company and a well-respected authority in drafting of Wills and rendering fiduciary services throughout South Africa.
In many cases, the primary reason for the delay is of a financial nature. One of the most common causes of a delay is a shortage of funds, when the assets in the estate are insufficient to cover the liabilities and administration expenses or when there is a cash shortfall. A lack of paper work, i.e. divorce documentation, can also cause a delay.
Another possible reason pertaining to finances are the deceased’s taxes, e.g. income tax and VAT. If the deceased’s taxes were not up to date or if the assets were not recorded properly, the Executor of the estate needs more time to re-examine everything. The Executor has no choice but to obtain the relevant documentation, complete the returns and submit them to SARS. At SARS, further delays may occur while processing the final assessments and a Tax Compliance Certificate must be issued before an estate can be finalised.
If the deceased was involved in litigation before his or her death, the Executor has to evaluate the amount of risk this poses to the estate, and might also need to complete the litigation process. More time and money may be lost in cases where a court date has to be secured, witnesses have to be called and documentation has to be completed.
Disputes between heirs take up precious time and may cause unnecessary stress to loved ones of the deceased. Resolving disputes often involve correspondence with the Master of the High Court which can be time consuming and delays the administration process even further.
Backlogs at institutions like SARS, banks and courts can be responsible for lost time, as can a poorly drafted Will and inadequate preparation.
Where a person died due to unnatural causes, an inquest needs to be held, which can take years to be finalised. Witnesses have to be called, and the South African Police Service has to submit a report to the court. The court then gives its verdict regarding the cause of death, which is required for the collection of accident and death benefits from insurance companies, etc.
Delays can occur when:
- Heirs cannot be traced; or
- An heir lives overseas and does not have a South African bank account, in which case they must comply with the requirements for emigration.
It is possible for you to avoid delays like these by making sure your affairs are in order ahead of time.
You want to make sure that:
• All the relevant documentation is available to the appointed Executor.
• Your taxes are up to date.
• Your Will is set up properly and clearly.
• You have insurance policies payable to the estate to avoid financial delays arising from lack of funds.
• Your next-of-kin is financially covered whilst waiting for finalisation of your
• When an heir lives overseas or emigrates, that he/she either retains a South African bank account or complies with the Reserve Bank’s requirements for emigration.
Again, consulting a trustworthy and professional service provider is non-negotiable to ensure the smooth winding up of an estate. Make use of the services of Legatus Trust.
LEAVING WITH A "TIP OF THE HAT”!
Bob Fosse was a choreographer, dancer and director best known for Tony Award-winning musicals like Chicago and Cabaret. When
he died of a heart attack at the age of 60 on 23 September 1987, he exited with a tip of the hat to friends. To 66 of his artist, writer, entertainer and other friends who had “at one time or another during my life been very kind to me,” he left $25 000, $378,79 each, “to go out and have dinner on me.”
Even though kindness is free of charge, it can still pay off!
Kindness is the language which the deaf can hear and the blind can see. Mark Twain
Until next time.
“The Legatus Times” Team
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