If two things in life are inevitable, it’s death and taxes. Often, these two go hand-in-hand. Death is a difficult time, and the legal and financial complexities that follow can be overwhelming. With this in mind, we’ve put together a guide that clarifies what you need to know about obtaining a deceased person’s tax number, filing their tax return and applying for a Letter of Executorship for a deceased estate.
How to get a tax reference number for a deceased individual
To obtain a tax reference number for a deceased individual, your best bet is to start by contacting the South African Revenue Service (SARS). Here are the general steps involved:
- Gather necessary information:
Full name of the deceased
Identity number
Date of death
Your relationship with the deceased
All relevant documentation, such as a death certificate - Contact SARS through a channel of your choice:
Phone: Call SARS at 0800 00 7277
In-person: Visit a SARS branch with the required documentation - Provide information and documentation:
Be prepared to answer questions about the deceased’s tax history and financial affairs.
Present the necessary documentation, including the death certificate.
SARS will verify the information and, if eligible, provide you with the deceased’s tax reference number.
How to file a tax return for a deceased person in South Africa
When a person passes away, their executor is responsible for finalising their tax affairs, including filing a final income tax return for the deceased. If this is you, here are the basic steps on how to file taxes for a deceased person:
1. Appoint an executor: The first step is to appoint an executor to manage the deceased’s estate. This is usually done through a will or by applying to the Master of the High Court.
2. Notify SARS of the death: Inform SARS about the individual’s death. This can be done through the SARS eFiling portal or by visiting a SARS branch if you happen to be in South Africa.
3. Get your paperwork in order: Collect all relevant documents, including:
- Death certificate
- ID document of the deceased
- ID document of the executor
- Proof of income (e.g., payslips, investment statements)
- Proof of expenses (e.g., medical expenses, funeral costs)
4. File the final income tax return for the deceased:
- Use the ITR12 form, the standard income tax return form for individuals, including deceased estates.
- Declare all income earned by the deceased up to the date of death.
- Claim any allowable deductions, such as medical expenses, donations, and retirement annuity contributions.
- If there are any outstanding taxes, these must be paid to SARS.
How to obtain tax clearance for the deceased estate
Once the final tax return is submitted and any outstanding taxes are paid, the executor can apply for a Deceased Estate Clearance (DEC) letter from SARS. SARS will issue one DEC letter for all tax types, including Estate Duty. This serves as confirmation that the deceased’s tax affairs are compliant.
What is a Letter of Executorship?
A Letter of Executorship is a legal document issued by the Master of the High Court that grants the named executor(s) the authority to administer the estate of a deceased individual. This document is vital as it gives the executor the legal power to:
- Manage the deceased’s assets
- Pay off debts
- Distribute the remaining assets to the beneficiaries as per the will or the laws of intestacy (if there’s no will)
Without this letter, the executor cannot legally perform these tasks.
How to apply for a Letter of Executorship in South Africa
To apply for a Letter of Executorship, you’ll typically need to follow these steps:
1.Appoint an executor: If there’s a will, the executor is usually named in the will. If there’s no will, the Master of the High Court will appoint an executor.
2.Get your paperwork in order:
- Death certificate: An original or certified copy
- ID document of the deceased: An original or certified copy
- Will (if applicable): The original will
- Inventory of assets and liabilities: A detailed list of all the deceased’s assets and debts
- Affidavit of Next-of-Kin: If no will exists, this confirms the relationship of the next-of-kin to the deceased.
- Master’s forms: The required forms will vary but can be obtained from the Master’s office or online.
3. Consult an attorney: If the estate’s value exceeds R250,000, it is mandatory to have an attorney handle the application for the Letter of Executorship. Even for smaller estates, an attorney can streamline the process and ensure compliance with legal requirements.
4.Submit the application: The application and the required documents are submitted to the Master of the High Court in the region where the deceased was domiciled. Submission can be carried out in person or through an attorney.
5.The Master will review and decide: The Master will review the application and documents. If everything is in order, they will issue the Letter of Executorship. If issues or additional information are required, the Master will contact the executor or their attorney.
Unclaimed funds for the deceased in South Africa
Did you know there is presently R89 billion in unclaimed assets and benefits in South Africa? That’s a substantial chunk of change, and a portion of it might be owed to you. Can you check if you are due online for unclaimed funds for the deceased in South Africa? Private retirement funds in South Africa must disclose all details of their unclaimed fund benefits to the Financial Sector Conduct Authority (FSCA), including amounts. This information can be accessed using the FSCA’s unclaimed benefits database, which you can search.
FinGlobal: let the experts handle it
Need assistance? We’d love to hear about it. FinGlobal’s dedicated team includes certified international financial planners, lawyers, chartered accountants, tax specialists, and bankers, who provide expertise in all cross-border finance and tax areas. We have strong relationships with all major insurance companies and the South African Revenue Service, which means we’re fully equipped to handle all tax-related matters and cross-border financial transactions for you, streamlining the process and eliminating the headache of dealing with SARS directly.
Please request a callback today to learn more about our full suite of cross-border financial services.