Estate Planning & Restructuring · 2026/27 Tax Year

Your estate faces three taxes and a tariff. The law gives you eleven tools.

Estate duty at 20–25%. Donations tax at 20–25%. Capital gains tax on death. Executor's fees at 3.5% plus VAT. South African law also provides the legitimate structures that manage all four. lawvero prepares the documents that build them, working with your tax advisor and our partner attorneys.

See the Eleven ToolsSee What Your Estate Would Pay Today
  • R150 000 · New annual donations tax exemption per person (2026 Budget, effective 1 Mar 2026; first increase since 2008)
  • R3.5m / R7m · Estate duty abatement, portable between spouses
  • R440 000 · CGT exclusion in the year of death (up from R300 000)
  • 3.5% + VAT · Executor's tariff on estate assets, reducible by structure
  • 2026/27 figures as announced in the February 2026 Budget and Rates Bill · subject to enactment

The tools

The eleven tools, itemised

Every one of these is established, lawful planning, and every one lives or dies on the quality of its documents. That's where we come in.

  1. 01

    The inter vivos trust with loan account: the estate freeze

    Growth assets are sold (not donated) to your family trust against a loan account. All future growth belongs to the trust; your estate holds only the frozen loan claim. Section 7C deems foregone interest on interest-free loans to be an annual donation, managed by charging the official rate, or by sizing the loan so the deemed donation stays inside the R150 000 annual exemption (a loan of roughly R1.8m per donor at the current 8.25% official rate; the figure moves with the repo rate), and by waiving R150 000 of loan capital per donor per year (R300 000 per couple): the slow-motion, tax-free unwind.

    Income Tax Act s7C · s56(2)(b) · SARS Draft IN on s7C (Nov 2025)

  2. 02

    Corporate estate pegging: preference share structures

    Your company issues growth ordinary shares to the family trust while you retain fixed-value preference shares equal to today's value. Growth accrues to the trust; your estate is pegged. Section 7C now expressly deems qualifying preference shares to be loans: the coupon must track the official rate. Entered through the corporate rollover machinery to avoid triggering CGT and transfer taxes on the way in.

    s42–47 rollovers · s7C(1)(b) · s24J · BPR 424 (2026) · BPR 400

  3. 03

    The spouse pipeline: s4(q), rollover and portability

    Bequests to your spouse are estate-duty free and roll over free of CGT, and your unused R3.5m abatement carries to the second-dying estate: R7m combined. The classic first-death will architecture defers both taxes a generation while the abatements stack. Watch the residence line: the CGT roll-overs already fall away where a spouse is a non-resident, and a 2026 draft amendment would limit the spousal donations exemption to a resident recipient spouse. See the emigrating-spouse note below.

    Estate Duty Act s4(q), s4A(2) · s9HA(2) ITA · s56(1)(b) draft 2026 · s9HB

  4. 04

    Retirement funds and living annuities: the quiet giant

    Contributions deduct up to the new R430 000 annual cap, growth inside the fund is untaxed, and retirement fund death benefits and living annuities pass outside your estate: no estate duty, no executor's fees, straight to nominated beneficiaries. For many professionals this is the cheapest estate duty shelter available.

    s11F ITA · Estate Duty Act s3(2) exclusions · Pension Funds Act s37C

  5. 05

    Life policy structuring: buy-and-sell and trust-owned cover

    Properly structured buy-and-sell policies between co-owners and qualifying key-person policies fall outside the dutiable estate; trust-owned policies create the liquidity to settle loan accounts and estate liabilities without swelling the estate. The structure and premium-payer rules decide everything.

    Estate Duty Act s3(3)(a)(i)–(iA)

  6. 06

    Usufruct and bare dominium splitting

    Transfer the bare dominium while retaining the usufruct, compressing the transferred value by the usufruct's actuarial value (capitalised at 12% over life expectancy). Powerful, technical, and litigated at the edges: cessation-of-usufruct duty and CGT base-cost apportionment demand deliberate drafting.

    Estate Duty Act s5(1)(b) · para 20 Eighth Schedule

  7. 07

    The donations programme

    R150 000 per person per year (R300 000 per couple) moves out of your estate tax-free, every year, forever. Donations to a resident spouse are wholly exempt (a 2026 draft amendment would tax donations to a non-resident spouse; see the emigrating-spouse note below); donations to PBOs are exempt and deductible up to 10% of taxable income; bequests to PBOs deduct from the dutiable estate. Documented donation agreements make each transfer defensible.

    s56(2)(b) · s56(1)(b) · s18A · Estate Duty Act s4(h)

  8. 08

    Special trusts: disability and minors

    Type A trusts (for beneficiaries with disability) and testamentary trusts for minor relatives are taxed at individual sliding rates instead of the flat 45%, with individual-level CGT treatment. Every will with young children should be engineered around this.

    s1 "special trust" ITA · para 82 Eighth Schedule

  9. 09

    The exclusions inventory

    R3 million primary residence exclusion (up from R2m), R50 000 annual CGT exclusion, R440 000 in the year of death, and small business relief of R2.7m (up from R1.8m) for owners aged 55 or older, or on ill-health or death, on disposals of a business worth up to R15m (up from R10m): mechanical reliefs that wills and disposal sequencing should be built around, not discovered afterwards. All 2026 Budget figures, subject to enactment.

    paras 44–51, 57 Eighth Schedule · 2026 Budget adjustments

  10. 10

    Offshore and situs planning

    SA residents holding US or UK situs assets face those countries' estate taxes: the US at 40% above a mere $60 000 for non-residents. Managed through estate duty treaties, offshore wrappers with institutional situs, asset-location choices and, where appropriate, foreign trusts navigated around the attribution rules. Namibia, with no estate duty, donations tax or CGT, is a structural alternative for the right client, and our Namibian trust product covers it end to end.

    s7(8) · para 72 · estate duty treaties · Namibian Trust Administration Act 11 of 2023

  11. 11

    Structural hygiene: the planning that behaves like tax planning

    Matrimonial regime choice (ANC with accrual shapes both estates), buy-and-sell agreements fixing succession value, instalment sale structuring of share disposals under section 24N where consideration is quantified over time, liquidity design so the estate never fire-sells, and assets already in trust escaping the 3.5% + VAT executor tariff entirely.

    Matrimonial Property Act · s24N ITA · Administration of Estates Act tariff

Recent change

Recent change: the emigrating-spouse trap

Two of the spouse reliefs above turn on residence, not just marriage. The moment a spouse ceases to be a South African tax resident, the picture shifts, and a 2026 draft amendment is tightening it further. This is the fastest-moving corner of the whole plan.

What Treasury is closing: the staggered-emigration arrangement

Couples planning to leave have used the unlimited inter-spousal donations exemption to move wealth offshore before the second spouse exits: one spouse ceases residence first; the remaining resident spouse then transfers substantial assets to the now non-resident spouse, tax-free, under section 56(1)(b); the remaining spouse later ceases residence with a much smaller asset base, shrinking the section 9H exit charge (the deemed disposal of worldwide assets at market value the day before residence ends).

The 2026 Draft Taxation Laws Amendment Bill, published for public comment on 30 July 2026, proposes to limit the inter-spousal donations exemption where the recipient spouse is a non-resident, with a proposed effective date of 25 February 2026. If enacted, a donation to a non-resident spouse would attract donations tax at 20% (25% above R30 million), with only the ordinary annual exemption. Status: draft, not yet enacted. Confirm the final wording and commencement before relying on it either way.

CGT already bites: section 9HB

Independently of the donations proposal, the interspousal CGT roll-over does not apply where the receiving spouse is a non-resident (save for assets that stay within the SA CGT net, such as local immovable property): section 9HB triggers CGT at the moment of transfer. So if the donations amendment passes, one transfer to a non-resident spouse could attract both CGT (s9HB) and donations tax (s56): a double charge on a single transaction.

On death, too: paragraph 67

The CGT roll-over to a surviving spouse under paragraph 67 of the Eighth Schedule does not apply to a non-resident surviving spouse. A first-death "spouse pipeline" (tool 03) that assumes both spouses are resident can quietly fail if one has emigrated: the deemed disposal on death is taxed rather than rolled over.

Treat each tax separately: the donations exemption, the s9HB roll-over and the s9H exit charge are three distinct questions, not one conclusion. Because this is draft law aimed at a narrow set of high-net-worth emigration cases, timing and genuine substance matter: have a registered tax practitioner confirm the position on your facts before any cross-border spousal transfer.

s56(1)(b) draft 2026 TLAB · s9HB · s9H exit charge · para 67 Eighth Schedule · proposed from 25 Feb 2026

Document preparation

Where lawvero does the work

Structures fail on paper before they fail anywhere else. We prepare the documents that make each tool real: attorney-reviewed, tax advisor aligned.

Trust Deeds & Amendments

Inter vivos discretionary deeds engineered for s7C-era compliance, independent trustee governance, and the SARS Draft IN's documentation standards. Testamentary and special trust provisions built into wills.

Sale & Loan Agreements

The freeze paperwork: sale-of-asset agreements, loan account agreements at the official rate, cession and pledge documents: the substance SARS reads first.

Donation Agreements

Annual R150 000 waiver programmes documented properly: donation agreements, loan reduction records, IT144 support: a standing annual service, per donor, per year.

S42–47 Restructures

Asset-for-share, intra-group, amalgamation and unbundling documentation for corporate pegging and group reorganisations: resolutions, agreements and election paperwork aligned to the rollover requirements.

S24N & Share Sale Structuring

Instalment share-sale agreements where consideration is quantified over time, preference share terms, subscription agreements and MOI amendments for pegging structures.

Trustee Resolutions & Minutes

The new battleground: resolutions recording distributions and retentions as trustee discretion, never beneficiary "agreement", as the SARS Draft Interpretation Note requires. Annual trust administration packs.

Wills & Estate Architecture

First-death spouse pipelines, abatement stacking, special trusts for minors, PBO bequests, liquidity clauses: the will as the keystone document of the whole plan.

Buy-and-sell & Policy Structuring

Buy-and-sell agreements with matching policy ownership and premium structures that keep proceeds outside the dutiable estate.

Cross-border & Namibia

Namibian trust formation and registration (no estate duty, no donations tax, no CGT), foreign-asset situs reviews, and SA–US exposure flags for families with American assets.

Valuation

Valuation: where every structure stands or falls

Every tool on this page depends on a defensible value. Sell an asset to your trust below market value and section 58 deems the shortfall a donation, taxed at 20%. Overstate a value and you inflate duty. SARS reads the valuation before it reads anything else. Here is how the law values each asset class, and who should do the valuing.

Immovable Property

Fair market value: the price between a willing buyer and willing seller at arm's length. In practice: a valuation by a professional (SACPVP-registered) valuer or detailed estate agent appraisal; the Master can insist on a sworn appraiser in deceased estates. For bona fide farming property, the Estate Duty Act itself applies fair market value less 30%.

Estate Duty Act s1 "fair market value" · Administration of Estates Act appraisals

Listed Shares & Instruments

The market does the valuing: quoted price on the exchange at the relevant date. No professional valuation needed: a broker statement or exchange data suffices. The simplest asset class to freeze or bequeath cleanly.

para 31(1)(a) Eighth Schedule

Unlisted Shares & Business Interests

The hard one. Fair market value determined by recognised methods: net asset value, capitalised earnings, or discounted cash flow, and the Estate Duty Act disregards certain MOI restrictions that artificially depress value. This valuation belongs with your accountant, auditor or a professional business valuer, in writing, with the method disclosed. It is the single most disputed number in estate planning.

Estate Duty Act s5(1)(f)bis · para 31 Eighth Schedule

Usufructs & Limited Interests

Valued actuarially: the annual value (12% of the full value unless SARS accepts otherwise) capitalised over the holder's life expectancy per the prescribed life tables. This is precisely why bare-dominium planning compresses value, and why the arithmetic must be done exactly, not approximately.

Estate Duty Act s5(1)(b) · prescribed tables

Loan Accounts & Claims

Face value, unless genuinely impaired: a loan to your trust sits in your estate at its full outstanding balance, which is the whole logic of the annual R150 000 waiver programme. Impairment claims need evidence, not assertion.

s5 Estate Duty Act · s7C ITA

Policies, Retirement & Foreign Assets

Policies at the amount payable; retirement interests per fund rules (outside the estate); foreign assets at fair market value converted at the applicable rate, and foreign situs assets may need a foreign valuation that satisfies the foreign revenue authority too.

s3–s5 Estate Duty Act · situs rules

The golden rule of the freeze

When assets move into a trust or company structure, the transaction must happen at properly evidenced market value, on the day, in writing. The valuation is obtained before the agreement is signed, it is referenced in the agreement, and it is kept with the trust's records. lawvero drafts the agreements around the valuation: the valuation itself comes from the right professional for the asset class, as set out above.

Roles

What lawvero does, and where your advisors take over

We are deliberate about our lane. lawvero is a document preparation service, not a financial services provider, not a law firm. That boundary protects you: every part of your plan is handled by the professional licensed to handle it.

lawvero

Document Preparation

Trust deeds, sale and loan agreements, donation agreements, trustee resolutions and minutes, wills, buy-and-sell agreements, s42–47 restructure paperwork, subscription and preference share documents, questionnaires and information packs: prepared on your instruction, incorporating the values and decisions supplied by you and your advisors.

lawvero

Factual Information & Tools

Plain-language guides to the law (like this page), calculators that apply published rates to your inputs, document checklists, and coordination of your signing and lodgement logistics.

Not lawvero

Financial Product Advice: FAIS

We do not advise on buying, selling, replacing or structuring any financial product: policies, investments, retirement products, living annuities, unit trusts or shares as investments. That is regulated financial advice under the FAIS Act and belongs exclusively with your licensed financial advisor (FSP). Where a structure involves a policy or investment decision, for example buy-and-sell cover amounts, policy ownership, or funding vehicles, the agreements we prepare must be considered and approved by your financial advisor before signature.

Not lawvero

Asset Valuations

We do not value assets. Property valuations come from professional valuers; business valuations from your accountant, auditor or a business valuer; actuarial values from the prescribed tables applied by the appropriate professional. We draft around the valuation you provide: we never generate it.

Not lawvero

Tax Opinions & Structuring Advice

The tax consequences of any structure: s7C exposure, rollover elections, attribution, cross-border positions, must be confirmed by your registered tax practitioner before implementation. Our documents are built to hold the structure your tax advisor designs.

Not lawvero: partner attorneys

Reserved Legal Work & Legal Advice

Litigation, court process, conveyancing, notarial execution (including antenuptial contracts) and formal legal advice are performed by admitted attorneys, referred to attorneys that can assist, or your own attorney of choice.

Our commitment, stated plainly

lawvero (Pty) Ltd is not a licensed financial services provider and provides no financial advice of any kind. Nothing on this page or in our documents is a recommendation regarding any financial product. Where your estate plan touches a financial product, an asset valuation, a tax position or reserved legal work, the relevant agreement must be reviewed by your own financial advisor, valuer, tax practitioner or attorney before you sign. We will tell you, clearly and every time, when a document you've asked us to prepare has crossed into territory that needs your advisor's eyes. That referral discipline is part of the product.

2026 landscape

What changed, and what SARS now checks

The 2026 landscape rewards documented structures and punishes informal ones.

The s7C Draft Interpretation Note (Nov 2025)

SARS's consolidated position: preference shares deemed loans, no in duplum relief, cross-border structures facing s7(8), s7C and s31 together, and the "conscious decision" test for vested amounts left in trust. On SARS's stated view, retentions by trustee discretion are safe, while retentions at the beneficiary's request or agreement are s7C loans; that view is contested, but your minutes now decide your tax.

Trust compliance has teeth

IT3(t) distribution reporting, beneficial ownership registers at the Master, and SARS administrative penalties from 2 March 2026 for trusts with both their 2024 and 2025 income tax returns outstanding. The era of the undocumented family trust is over: administration discipline is now a tax strategy.

Proposed resident-spouse limitation

The 2026 draft Taxation Laws Amendment Bill proposes that, with effect from 25 February 2026, the spousal donations exemption applies only where the recipient spouse is a tax resident: a direct response to emigration-linked planning. Not yet enacted. Families with a spouse emigrating should take advice on sequencing before any spousal transfer.

The numbers moved: plans should too

R150 000 donations exemption, R440 000 death-year CGT exclusion, R3m primary residence exclusion, R430 000 retirement cap: all announced in the February 2026 Budget and subject to enactment. Every plan built on the old numbers is leaving relief unused. An annual review captures it.

Important: lawvero (Pty) Ltd provides document preparation services and does not provide legal, tax or financial advice. lawvero is not a licensed financial services provider under the FAIS Act and provides no advice in respect of any financial product; where a document or structure involves a financial product, asset valuation or tax position, it must be considered by the client's own licensed financial advisor, professional valuer and/or registered tax practitioner before implementation. Reserved legal work is performed by our partner attorneys. Figures reflect the 2026/27 fiscal year as announced in the February 2026 Budget and the Rates and Monetary Amounts Bill, are subject to enactment and legislative change, and should be confirmed with your tax practitioner. © lawvero (Pty) Ltd 2026 · law, verified.

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Start with the number

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