If you’re inheriting a house in South Africa from abroad, you might be wondering where to begin. What happens when you inherit a house in South Africa while living abroad? Whether you’re an expat or living outside of South Africa for good, dealing with cross-border estate matters can feel overwhelming, especially when property is involved.
This guide explains the inheritance process in South Africa, focusing specifically on residential property, and breaks it down into clear steps, whether or not there’s a valid South African will in place.
Let’s get into the steps to inherit a property in South Africa as a non-resident:
Step 1: Is there a valid South African will?
First things first — was there a valid South African will in place? If there is one, it should name an executor to manage the estate. That person will need to be officially appointed by the Master of the High Court before they can do anything.
If there’s no will, then South African intestate succession laws will kick in. This means the estate will be distributed to family members in a specific legal order, which could make things more complicated and time-consuming.
Step 2: Work with the Master’s Office and the DOJ
Once you know whether or not a will exists, the estate must be reported to the Master’s Office, which is usually in the region where the deceased lived. The Department of Justice (DOJ) oversees this, and you’ll need to wait for Letters of Executorship (or Authority, for smaller estates) before any transfers or sales can happen.
If you’re overseas, it’s smart to appoint someone on the ground to handle the legwork locally. This minimises any potential communication delays caused by differing time zones.
Step 3: Double-check the title deed and any debts
Before you can take ownership, the title deed needs to be checked to verify that it matches what’s in the will or the Master’s Office records. You’ll also want to dig for any outstanding liabilities attached to the property, like:
- Unpaid municipal rates or utilities
- An existing home loan or bond
- Possible legal disputes or registered interests/liens
All of these will need to be cleared before the inheritance transfer process in South Africa can move forward.
Step 4: Get a property valuation
This is one of the most important steps. A professional property valuation tells you how much the house is worth – numbers that are essential for calculating estate duty, planning for capital gains tax, or deciding whether it’s better to rent, sell, or keep the home.
Even if you’re not sure what you want to do with the house just yet, knowing its value puts you in a much stronger position.
Step 5: Arrange a home inspection
A home inspection isn’t legally required, but it’s recommended, especially if the house has been empty for a while. It can uncover:
- Structural issues
- Maintenance concerns
- Hidden damage
This information can help you make decisions about renovating, renting, or selling, and it avoids any surprises down the road.
Step 6: Decide what to do with the property
Once you’ve got all the facts, such as the title, condition, and value, it’s time to weigh up your options:
- Keep it as a holiday home or future retirement property
- Rent it out for some passive income
- Sell the house and cash in on the asset
Each route comes with pros and cons. If you rent, you’ll need someone to manage it locally. If you sell, you’ll need to factor in agent commissions, conveyancing fees, and capital gains tax. And if you keep it? Don’t forget about ongoing rates and taxes, and general upkeep.
Read more: The FYI on the tax implications of selling a house inherited from a deceased estate.
Step 7: Understand the fees, duties and taxes
Good news: In South Africa, inheritance tax doesn’t apply to you personally, but the estate itself may still have costs to cover. These might include:
- Estate duty (only applies if the estate is worth over R3.5 million)
- Capital gains tax (if the property is sold)
- Executor’s fees (usually a percentage of the estate value)
- Transfer costs when the house is officially registered in your name
It’s a good idea to speak to an expert to understand what applies in your situation, especially if you’re living abroad.
Read more: Will you pay Capital Gains Tax when inheriting and selling a property in South Africa?
Step 8: Externalise the funds – now or later?
Once the property is sold, or if you earn rental income (which is taxable in South Africa, btw), you’ll probably want to figure out how to externalise inheritance funds from South Africa.
Here’s what you need to know:
- If you’ve formally ceased tax residency, you’ll need to show SARS proof
A Tax Compliance Status (TCS) PIN is needed for fund transfers. - It’s best to go through an authorised foreign exchange specialist
You don’t have to move the funds out right away, but depending on currency fluctuations and future regulations, sooner might be smarter than later.
Read more: Externalising funds from South Africa: An Exchange Control compliant approach.
FinGlobal: cross-border financial specialists for expats abroad
Inheriting a house in South Africa from abroad might seem complicated, but as long as you go into it with a clear understanding of the steps involved, it doesn’t have to be overwhelming. Whether you choose to sell, rent or keep the house, making sure you’ve got the right support to manage the cross-border admin will be key to ensuring a smooth experience.
If you’re looking for assistance with claiming your South African inheritance and making it work for you, FinGlobal is ready to lend a hand. FinGlobal offers tailored, end-to-end financial services for South Africans, designed to deliver faster payouts, competitive exchange rates, and full regulatory compliance.
Take advantage of our cross-border expertise, with a diverse team specialising in law, tax, accounting, banking and international finance.
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