Resources · Estate & Business Structuring

Understanding trusts in South Africa

A plain-language guide: eight questions, straight answers.

Current as at July 2026

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This guide gives general information about South African law. It is not legal advice and does not create a professional relationship. For a decision on your own circumstances, obtain advice on your specific facts.

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Contents

  1. Where trusts come from, and what forms exist
  2. What breathes life into a trust, how it's created, and what governs it
  3. Why register a trust? And what are the benefits?
  4. How do I manage my trust? What is required of me?
  5. How are trusts taxed?
  6. What is the ideal trust structure?
  7. Do I really need a trust? Why all the effort?
  8. What happens if I want to dissolve a trust?

1. Origins & forms

Where do trusts come from, and what forms exist in South Africa?

The trust is one of the most useful, and most misunderstood, structures in South African law. Unlike a company, it wasn't invented here. It was borrowed from a very old idea, and then reshaped to fit our courts. A little of its history makes the whole thing click.

A short history: from crusaders to the Cape

To understand why a trust is such a powerful tool, it helps to know where it came from, and the story starts not in South Africa, but in medieval England, on the road to the Crusades.

Picture an English knight in the twelfth or thirteenth century preparing to leave for the Holy Land. He might be gone for years; he might never come home. Yet his land still had to be farmed, his feudal dues still had to be paid to the Crown, and his wife and children still had to be provided for. Medieval law had no tidy way for an absent man to leave his affairs in safe hands. So landowners reached for a simple, very human solution: before riding off, a knight would transfer his land to a trusted friend or kinsman, on the clear understanding that this person would hold and manage it for the family, and hand it back on his return. On paper the holder became the owner; in reality the family kept the benefit. The arrangement was called a "use", and that split between the person who owns and the person who benefits is the beating heart of every trust to this day.

The "use" soon proved handy for far more than crusaders. For long stretches of English history a married woman could not hold land in her own name, so land could be placed with trusted holders for a woman's benefit. Fathers used it to provide for daughters and younger sons who would otherwise be shut out by primogeniture, the rule that handed everything to the eldest son. It could pass land on death at a time when land could not freely be left by will, and it could even soften the feudal taxes that fell due whenever land changed hands. In a rigid legal world, the "use" was the flexible workaround.

There was one catch, and it turned out to be the making of the trust. The ordinary royal courts recognised only the legal owner. If the trusted holder simply broke his word and kept the land, the family had no claim the common law would hear. Desperate petitioners took their grievances to the King, who passed them to his chief conscience-keeper, the Lord Chancellor. The Chancellor began ordering these faithless holders to honour their promises, not because the strict letter of the law required it, but because fairness did. Out of thousands of such decisions grew "equity", an entire parallel body of English law devoted to good conscience. The trust is equity's finest creation: the legal owner holds the title, but equity binds his conscience to hold it for someone else. Over the centuries that followed, the "use" matured into the "trust", refined by the courts of Chancery into a flexible instrument for holding wealth across generations.

How the trust reached South Africa

When British administration arrived at the Cape in the early nineteenth century, the trust travelled with it. But South Africa's legal system was, and remains, Roman-Dutch at its foundation, and Roman-Dutch law knew nothing of equity, or of splitting ownership into "legal" and "beneficial" halves. Our courts could have turned the foreign guest away. Instead they gave it a local home, reimagining the trust in civil-law language: not as a split in ownership, but as an arrangement in which trustees hold assets in a distinct capacity, for the benefit of others. The South African trust is therefore a genuine hybrid, English by descent, Roman-Dutch by upbringing. For most of its life it lived in the case law alone; only in 1988, with the Trust Property Control Act, did Parliament finally set down statutory rules for how trusts must be administered.

Forms of trust, two ways to classify

By how the trust is created:

  • Inter vivos (living) trust, created during the founder's lifetime by a contract, the trust deed, between founder and trustees. This is the workhorse of estate planning.
  • Testamentary (will) trust, created in a will and coming into being on the founder's death; commonly used to hold assets for minor children until they come of age.
  • Court or statutory trusts, created by court order or under a statute; less common in everyday practice.

By how beneficiaries hold their benefit:

  • Discretionary (ownership) trust, the trustees own and control the assets and decide whether, when and how much each beneficiary receives. Beneficiaries have only a hope (spes), not a vested right. Most family trusts are discretionary, and that flexibility is exactly what gives the trust its asset-protection and planning power.
  • Vested trust, beneficiaries have fixed, vested rights to income and/or capital; the trustees simply administer what is already, in substance, theirs.
  • Bewind trust, ownership of the assets vests in the beneficiaries, but the trustees control and administer them, useful where a beneficiary cannot manage the assets themselves.

Special trusts, a gentler tax category, for good reason

A "special trust" is not a different way of creating a trust, it is a label the tax law attaches to certain trusts that exist to protect vulnerable people rather than to shelter wealth. Because the ordinary trust rate is deliberately steep (a flat 45%), the Income Tax Act carves out two kinds of trust for gentler, individual-scale taxation:

  • Type A, the disability trust. Set up for the benefit of a person (or persons) with a serious mental or physical disability that prevents them from earning enough to support themselves or from managing their own money. The disability must meet the definition in the Income Tax Act, and the status is confirmed with SARS (with medical confirmation). Because the trust exists to care for someone who genuinely cannot provide for themselves, it is taxed on the same sliding scale as an individual, with certain capital-gains reliefs, not at 45%. A Type A trust can be created during the founder's lifetime or in a will.
  • Type B, the testamentary trust for minor children. Created only in a deceased person's will, for the benefit of that person's relatives, where the youngest beneficiary is under 18. It typically holds a parent's estate for their children until they are old enough to inherit outright, and it too is taxed on the individual sliding scale. Once the youngest beneficiary turns 18, the trust loses its special status and is taxed as an ordinary trust.

The reason for the distinction is fairness. The punishing 45% rate is designed to discourage using trusts as tax shelters, but that logic simply doesn't fit a trust whose whole purpose is to look after a disabled family member or orphaned children. So the law treats those trusts as if the vulnerable beneficiary held the assets personally. One practical caution: special-trust status is not automatic, it has to be established correctly and maintained, and getting it wrong means the full 45% applies.

Key takeaway

South Africa didn't invent the trust; it inherited the medieval English "use", born of crusaders, absent lords and the property rules of the day, and adapted it into its Roman-Dutch system. In practice you'll meet two big distinctions: inter vivos vs testamentary (how it's born) and discretionary vs vested vs bewind (how beneficiaries hold benefit), plus the tax-driven "special trusts" for the disabled and for minor children.

2. Creation & governing law

What breathes life into a trust, how it's created, and what governs it?

How is a trust created? Let's walk through it

It's worth understanding this properly, because a lot of clients assume a trust exists the moment they sign a document, and that's not quite how it works.

A trust starts with you, the founder, deciding to place certain assets under the control of trustees for the benefit of the people you name, your beneficiaries. You capture that decision in a document called the trust deed. Think of the deed as the trust's constitution: it names the founder, the first trustees and the beneficiaries, sets out what the trustees may and may not do, and says how the trust will run and how it will eventually end.

For the trust to be valid, a few things genuinely have to be true, and courts do check them if a trust is ever challenged:

  • You must truly intend to create a trust and to give up control of the assets to the trustees, not merely say so on paper while carrying on as if the assets are still yours.
  • The deed must identify the trust property, what is actually going into the trust.
  • It must identify the beneficiaries or the purpose, who, or what, is to benefit.
  • The purpose must be lawful. A trust can't be used to do something the law forbids.

You and the trustees then sign the deed. But here is the part that surprises people: signing the deed does not yet let the trustees do anything. In South Africa a trust only becomes operational once the Master of the High Court has issued the letters of authority, an official document confirming who the trustees are and that they are authorised to act. Until that letter is in hand, no bank will open an account, no property can be transferred, and nothing can validly be signed in the trust's name.

So creating a working trust is really two steps: first the deed (which brings the trust into existence), then lodging it with the Master and receiving the letters of authority (which bring the trustees' powers to life). At lawvero we handle both, and we don't let anything be signed in the trust's name until that letter is issued, because, as you'll see below, acts taken too early generally can't be rescued afterwards.

Along the way you'll also decide a few practical things: who your trustees are (including at least one independent trustee), whether the trustees must lodge security with the Master or be exempted from doing so in the deed, and how the trust will be funded, by donation or, more commonly, by an interest-bearing loan (each of which carries tax consequences covered later).

What governs trusts, the full stack of authority

Legislation (the daily-driver statutes):

  • Trust Property Control Act 57 of 1988, the primary statute on administration: registration, the Master's oversight, trustee authorisation and duties, security, accounting and removal.
  • General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022, amended the TPCA from 1 April 2023 to add beneficial-ownership registers, accountable-institution records and trustee disclosure duties.
  • Financial Intelligence Centre Act 38 of 2001 (FICA), trust service providers are now accountable institutions, and trustees must disclose their trust capacity to the accountable institutions they deal with.
  • Income Tax Act 58 of 1962, s25B (the conduit principle), s7 (attribution), s7C (loans to trusts), and the definitions of "trust" and "special trust"; together with the Tax Administration Act 28 of 2011.
  • Estate Duty Act, Transfer Duty Act and the donations-tax provisions, all bite when assets move into or out of a trust.
  • Administration of Estates Act 66 of 1965, the Master's broader functions; and, depending on the assets and disputes, the Companies Act, Insolvency Act, Matrimonial Property Act and Divorce Act, and the Constitution/PAJA for reviewing the Master's decisions.

Common law: This is the piece people forget. The TPCA regulates how trusts are administered, but it does not codify the law of trusts. The substance, what a trust is, the trustee's fiduciary duties, how beneficiaries' rights work, lives in the common law, built up by the courts case by case.

The cases that shape your trust

Four decisions do most of the day-to-day work in South African trust law. They're worth knowing, because between them they explain why a well-built structure looks the way it does.

  • Braun v Blann and Botha (1984), the case that settled what a South African trust actually is. The court made clear that a trustee is not merely the agent or mouthpiece of the beneficiaries, and not the same thing as the executor of a deceased estate, a trustee holds and controls the assets in their own right, for others. For you, this is the very foundation of why a trust protects assets: the trustees genuinely own and control the trust property; it isn't just your own money wearing a disguise.
  • Land and Agricultural Bank of SA v Parker (2005), the single most important warning in our trust law. The Parker family ran their trust as their own piggy bank: the same people were founders, the only trustees and the only beneficiaries, and they ignored the formalities. The Supreme Court of Appeal held that where there is no real separation between those who control a trust and those who benefit from it, where the trust is run as the founder's "alter ego", a court can look straight through it and treat the assets as the founder's own. This is exactly why every serious structure includes at least one genuinely independent trustee, and why decisions must be minuted and the money kept separate. Those formalities aren't red tape; they're what makes the protection real.
  • Doyle v Board of Executors (1999), confirmed that trustees owe beneficiaries a fiduciary duty, the highest duty of good faith the law recognises, and must account fully for how the trust is run. For a beneficiary, it means you are entitled to know what the trustees are doing with the assets. For a trustee, it means keeping proper records and accounting honestly is not optional.
  • Thistle Trust v SARS (Constitutional Court, 2024), a recent and important tax decision. The court held that you cannot lean on the old common-law "conduit" idea to stream capital gains down through several layers of trusts to reach lower tax rates, the words of the Income Tax Act come first. If a structure involves more than one trust, this is why its tax treatment has to be mapped carefully rather than simply assumed.

Does a trust have its own legal personality? The curious vacuum

Short answer: no, and that produces one of the genuine curiosities of South African law.

A company is a juristic person: the law treats it as a separate legal "someone" that can own property, sue and be sued, and act, all in its own name. You, a natural person, are obviously a legal "someone" too. A trust is neither. It has no separate legal personality of its own. Strictly speaking it is not a person at all, it is a collection of assets tied to a purpose and administered by trustees.

That leaves an odd gap, a kind of vacuum. If the trust is not a person, then who owns the assets? Who signs? Who sues? The law fills the vacuum through the trustees: they hold the assets and act, but in a special separate capacity, "in their capacity as trustees" (nomine officii), not in their personal capacity. So when a trust "buys" a property, the trustees buy it in their trustee capacity; when a trust "sues", it sues through its trustees. The trust is the estate; the trustees are its hands and its legal face.

Two consequences flow from that in-between character:

  • The separation that protects you. Because the trust property is held by the trustees in their separate trustee capacity, it forms no part of any trustee's personal estate. If a trustee is sequestrated personally, their creditors cannot reach the trust assets. That separation, a direct result of the trust having its own estate but no personality, is the engine of asset protection.
  • The places the law plugs the gap. Because a body of assets with no legal personality is awkward to deal with, several statutes simply deem a trust to be a "person" for their own purposes. The Income Tax Act taxes a trust as a person in its own right; the Insolvency Act lets a trust be sequestrated as though it were a debtor. So in everyday life the trust behaves like an entity, it has a tax number, it contracts, it can be sued, even though, in pure theory, it isn't a person at all.

The takeaway is not to be unsettled by the theory. The trust works because it sits in this in-between space: enough of a separate estate to protect assets and to be taxed and sued, but not a person that you, or anyone else, personally owns. That in-between character is a feature, not a flaw.

Can a trust ratify decisions taken before the letters of authority?

The prevailing rule is no. Because a trustee has no capacity to act before the Master issues letters of authority (section 6(1) of the TPCA), acts done before authorisation are generally regarded as void, and something void cannot be ratified. This follows the line of authority in Simplex (Pty) Ltd v Van der Merwe: a contract concluded by a "trustee" who is not yet authorised is a nullity, not merely voidable, and cannot be validated after the fact by later authorisation or by the trust purporting to ratify it.

The practical lesson is timing. Don't sign anything in the trust's name, offers to purchase, loan agreements, bank mandates, until the letters of authority are issued. If you must move early, the usual route is to contract subject to the trust being established and authorised, or to have the founder contract and cede across properly once the trust is up and running. Courts have shown some nuance here, so the position is worth confirming for your specific facts.

Key takeaway

The deed creates the trust; the Master's letters of authority empower the trustees, so a working trust is a two-step affair. Trusts sit on a stack of statute layered over a large body of common law and a handful of decisive cases. A trust has no legal personality of its own, which creates a vacuum the law fills through the trustees and through statutes that deem it a "person", and trustees generally cannot act, bind the trust, or ratify earlier acts done before the letters of authority are issued.

3. The actual benefits

Why register a trust? And what are the benefits?

Almost nobody sets up a trust for its own sake. They do it to achieve something specific. So the real question behind "why register a trust?" is simply: what does a trust actually get me, and is it worth the effort? Here is the honest answer.

  • Asset protection. Because trust assets are a separate estate and don't belong to you personally, they are generally beyond the reach of your personal creditors and your insolvency, provided the trust is genuine and properly run. This is the single most common reason people in business set one up. (A trust used as your alter ego protects nothing, see the Parker case above.)
  • Estate-duty and continuity planning. Assets you move into a trust, and, importantly, their future growth, sit outside your personal estate. On your death they don't have to be wound up in your deceased estate; the trust simply continues, avoiding the delays, executor's fees and asset-freezing that come with winding up an estate. The growth is effectively "pegged" outside your estate for estate-duty purposes.
  • Protecting vulnerable beneficiaries. A trust can hold and manage assets for minor children, a family member with a disability, or anyone who can't manage money, paying out on your terms and over time, rather than handing over a lump sum they may not be ready for.
  • Flexibility. A discretionary trust lets the trustees decide who receives what, and when, in response to changing family circumstances and tax positions, including streaming income to beneficiaries who are on lower tax rates.
  • Business succession. Shares in the family business held in a trust pass seamlessly across generations, without the business having to be sold or frozen when a shareholder dies.
  • Consolidation and confidentiality. A family's wealth can be held and governed within one considered structure, rather than scattered across personal names.

The honest counterweight

Every one of these benefits is real only if the trust is properly funded, properly administered and genuinely controlled by its trustees. Against them, weigh the flat 45% income-tax rate on retained income, the section 7C rules on loans, donations tax on funding, the ongoing administration burden, and the plain fact that you give up personal ownership of the assets. A trust is a powerful tool, not a magic wand, and registering one is the gateway that makes all of the above possible: until the Master issues the letters of authority, none of these benefits can be put to work.

Key takeaway

You register a trust to unlock what it can do: asset protection, estate-duty and continuity planning, provision for vulnerable beneficiaries, flexibility, and clean business succession. But every one of those benefits depends on the trust being real and well run. Set it up loosely and you get the costs without the protection.

4. Ongoing duties

How do I manage my trust? What is required of me?

Being a trustee is a job with legal standards, not a title on a page. The essentials:

  • Act to a high standard of care. Section 9 of the TPCA holds trustees to the care, diligence and skill reasonably expected of someone managing another person's affairs, a higher bar than looking after your own money.
  • Keep trust property separate and identifiable. Trust assets must be held in the trust's name, in a separate trust bank account, never mixed with your personal assets. This separation is the whole point; blur it and you risk the trust being disregarded.
  • Act jointly and by proper resolution. Unless the deed says otherwise, trustees must act together and unanimously. Decisions, especially distributions, should be taken at properly minuted meetings, in writing. "Deciding it in my head" is how trusts get attacked as shams.
  • Follow the deed and keep your discretion. Trustees must act within the powers in the deed and apply their own minds; core discretionary decisions cannot be delegated away.
  • Keep an independent trustee. Courts expect at least one independent trustee who is not a beneficiary and will genuinely apply their mind, especially where the founder is also a trustee and a beneficiary (the Parker principle).
  • Account and keep records. Proper financial statements, minutes, and a standing duty to account to the beneficiaries.
  • Beneficial-ownership and FICA duties (since 1 April 2023). Trustees must establish, record and lodge a beneficial-ownership register with the Master, covering the founder, the trustees and the named beneficiaries, plus anyone exercising effective control, keep certified IDs on file, record the accountable institutions the trust uses, and disclose the trust's capacity when dealing with them. Non-compliance carries penalties of up to R10 million and/or five years' imprisonment.
  • Tax duties. Register the trust for income tax, submit its annual return (the ITR12T), and be aware of the third-party trust reporting (IT3(t)) that now flows distribution data to SARS, which is why distributions and loan accounts must be documented accurately.

Key takeaway

Managing a trust means running it like the separate, governed structure it is: separate bank account, joint and minuted decisions, an independent trustee, proper records, the beneficial-ownership register, and clean tax filings. The effort is the protection, a well-administered trust holds up; a loosely run one gets looked through.

5. Tax treatment

How are trusts taxed?

A trust is a taxpayer in its own right, and South Africa taxes it deliberately hard to discourage using trusts purely to avoid tax.

  • Income tax. A trust (other than a special trust) pays a flat 45% on income it retains, no brackets, no rebates. Special trusts (Type A disability, Type B testamentary for minors) are taxed instead on the individual sliding scale, which is far gentler.
  • The conduit principle (s25B). If income is vested in or distributed to a beneficiary in the same tax year, it's taxed in the beneficiary's hands at their (usually lower) rate, keeping its nature as it flows through. This is why trustees typically distribute rather than retain.
  • Capital gains tax. A trust includes 80% of a capital gain in its taxable income, giving a maximum effective CGT rate of about 36%, double the 18% an individual pays. If the gain is vested in a beneficiary in the same year, it's taxed in their hands at up to 18% instead. Note the Constitutional Court's 2024 Thistle Trust decision, which shut down streaming capital gains through multiple tiers of trusts.
  • Attribution rules (s7). Where you donated or settled the assets that produce the income, SARS can tax that income back in your hands rather than the trust's, for example, income attributable to a spouse or a minor child.
  • Funding a trust, donations tax and s7C. Transferring assets to a trust for less than value is a donation, taxed at 20% (25% above R30 million) after the R100,000 annual exemption. Most founders lend rather than donate, but section 7C treats an interest-free or low-interest loan to a trust as a deemed annual donation equal to the interest foregone (measured against the official rate), which erodes the R100,000 exemption each year. Loan accounts are now a top SARS audit target.
  • Estate duty. Assets properly held in a trust generally fall outside your dutiable estate, a key benefit, although any loan account the trust owes you remains an asset in your estate.

Key takeaway

Retained trust income is taxed at a flat 45% and gains at about 36%, deliberately punitive, which is why the conduit principle (distributing to beneficiaries on lower rates) drives most trust tax planning. Watch section 7C on loans and the attribution rules: they are where trusts most often go wrong, and where SARS is now looking hardest.

6. Structuring

What is the ideal trust structure?

A common and effective structure for a family with a business places a discretionary family trust at the top, owning the shares in a holding company, which in turn owns the operating subsidiaries, often alongside a separate property company.

Why it is shaped this way

  • The trust at the top holds the shares. Because the trust, not you, owns the holding-company shares, the growth in the value of the business accrues outside your personal estate, pegging your estate for estate-duty purposes and putting that value beyond your personal creditors.
  • The holding company consolidates and protects. Holdco owns the subsidiaries and can hold the group's stable assets (intellectual property, key contracts), keeping them away from day-to-day trading risk.
  • The subsidiaries ring-fence operating risk. Each trading business sits in its own company with limited liability, so a failure or claim in one doesn't sink the others or reach the group's core assets. A separate property company holds real estate and leases it to the operators.
  • Tax efficiency where the trading happens. Companies are taxed at 27% and can retain earnings at that rate, far better than a trust's 45%, while dividends flow up the chain (dividends between resident companies are generally exempt), and the trust distributes to beneficiaries through the conduit when it's efficient to do so.
  • Clean succession and sale. The business can be sold by selling shares, and ownership passes across generations through the trust without freezing anything on a death.

The cautions

Fund the structure properly (mind section 7C on any loans into the trust); give the trust real substance and an independent trustee (Parker); keep the beneficial-ownership registers current across both the trust and the companies; and remember the Thistle Trust limits on streaming gains through multiple trusts. Structure follows purpose, don't over-engineer a structure you won't administer.

Key takeaway

Trust-over-Holdco-over-subsidiaries works because each layer does one job: the trust holds value outside your estate, Holdco consolidates and protects core assets, and the subsidiaries ring-fence trading risk, with trading taxed at the company's 27% rather than the trust's 45%. It only delivers if it's properly funded, genuinely controlled by trustees, and kept compliant.

7. The honest test

Do I really need a trust? Why all the effort?

Straight answer: sometimes yes, often no, and setting one up "just in case" can leave you worse off.

A trust is likely worth it if… you have, or are building, significant and growing assets or a business; your estate will exceed the R3.5 million estate-duty abatement and you want to peg future growth; you need genuine asset protection (you're in business, you sign surety, or you carry personal risk); or you're providing for someone who can't manage money, a minor, or a family member with a disability.

A trust is probably not worth it if… your estate is modest; you won't commit to running it properly; or the tax cost outweighs the benefit. The costs are real: the flat 45% on retained income, section 7C on loans, donations tax on funding, annual administration and accounting, beneficial-ownership filings, and the loss of personal control. A trust you secretly still control isn't protecting you, it's a target.

The honest test

A trust is a governance commitment, not a product you buy once. Run properly, it's one of the best asset-protection and succession tools available. Run loosely, it gives you all of the cost and none of the protection, and hands SARS and creditors an easy argument that it's your alter ego. If you're not going to administer it properly, you probably shouldn't have one.

Key takeaway

Get a trust for a reason, real assets, real risk, real succession or care needs, not out of habit. The effort of running it properly is exactly what makes it work; skip that effort and the trust protects nobody.

8. Winding up

What happens if I want to dissolve a trust?

A trust doesn't last forever, and winding one up is a deliberate legal process, not a quiet decision around the dinner table.

When a trust ends

On the terms of its own deed (a termination date or a triggering event); when its purpose is fulfilled or becomes impossible; by agreement of those with an interest, where the deed allows; by order of court; or through sequestration (insolvency).

How it's done, in outline

  • Check the deed first. It usually sets out how and when the trust terminates and how the remaining assets are to be distributed.
  • Pass proper resolutions. The trustees resolve to wind up and to distribute the assets to the beneficiaries entitled to them.
  • Plan the tax and costs before distributing. Transferring assets out is a disposal for CGT; transferring fixed property attracts transfer duty and conveyancing; and if a loan account the trust owes is waived, section 7C / donations-tax consequences can follow. These are planned, not discovered afterwards.
  • Account and settle. Finalise the financial statements, settle liabilities, and account to the beneficiaries.
  • Close formally with the Master. Distribute the assets, then apply to the Master to terminate the trust and surrender the letters of authority. The Master will want to see that the assets have been distributed and the trust has served its purpose, it won't simply deregister a trust on request.

Key takeaway

A trust ends on its deed's terms, by agreement, by a court, or on insolvency, but ending it cleanly means resolutions, planning for CGT, transfer duty and section 7C, accounting to beneficiaries, and formally terminating with the Master and surrendering the letters of authority. Distribute first, deregister second.

Currency & sources

Current as at July 2026. Tax figures reflect the 2025/26 tax year and the position confirmed in the February 2026 Budget (trusts other than special trusts taxed at a flat 45%; maximum effective CGT rate for trusts about 36%; donations tax 20%, rising to 25% above R30 million, with a R100,000 annual exemption). Rates and the official rate of interest change each Budget, refresh annually before publishing.

Principal legislation: Trust Property Control Act 57 of 1988; General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022 (amending the TPCA from 1 April 2023); Financial Intelligence Centre Act 38 of 2001; Income Tax Act 58 of 1962 (ss 7, 7C, 25B); Tax Administration Act 28 of 2011; Estate Duty Act 45 of 1955; Administration of Estates Act 66 of 1965.

Principal case law: Braun v Blann and Botha 1984 (2) SA 850 (A); Land and Agricultural Bank of SA v Parker 2005 (2) SA 77 (SCA); Doyle v Board of Executors 1999 (2) SA 805 (C); Simplex (Pty) Ltd v Van der Merwe 1996 (1) SA 111 (W); Thistle Trust v Commissioner for SARS (Constitutional Court, 2024). Please confirm citations against the current law reports before publication.

This guide is general information on South African law and not legal advice. It does not create a professional relationship, and it is not a substitute for advice on your specific circumstances.

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