Don’t let your family inherit a legal headache in two countries. If your assets sit in two countries, having a single will may be setting your family up for exactly what you tried to prevent: months of delays, frozen accounts and two legal systems that each insist on their own paperwork before your family sees a cent.
Transferring South African inheritance overseas: Can one will not simply cover everything?
Technically, yes. A properly drafted South African will can deal with your worldwide assets, and South African law recognises validly executed foreign wills. The problem is not validity. The problem is practicality.
Whether a foreign authority, bank or land registry will recognise and efficiently process a South African will depends on the laws of the country where the assets are located. Some countries strongly prefer, or require, a locally compliant will before they will transfer property. The reverse is also true: the Master of the High Court in South Africa requires an authenticated or apostilled copy of a foreign will, often with formal translations, before local assets can be dealt with, which can add months or even years of delay.
Read more: What happens to your overseas assets if you only have a South African will when you die?
The circumstances that usually call for two wills
1. You own immovable property in more than one country
Fixed property is governed by the law of the country where it is situated. If you own a house in South Africa and an apartment in your new home country, each property is subject to a different legal system, with its own formalities for valid wills and its own process for transferring ownership on death. A separate will is almost always recommended where immovable property is owned in another country.
2. Your new home country has forced heirship rules
South Africa follows freedom of testation, meaning you may generally leave your estate to whomever you choose. Many civil law countries, including several in Europe, apply forced heirship, which reserves a fixed portion of your estate for particular family members regardless of what your will states. If you now live in, or own assets in, a forced heirship jurisdiction, a locally drafted will helps you navigate those rules properly rather than discovering the conflict after your death.
3. Your executor cannot act abroad
A South African executor is appointed by the Master of the High Court, but that appointment does not automatically carry authority in another country. The executor may first have to be recognised by the authorities where the foreign assets are situated. This is a process that is typically time-consuming and expensive. In England, for example, institutions may refuse to release funds until the South African Letters of Executorship have been resealed by the UK probate court. Since the two processes cannot run simultaneously, the entire administration is delayed. With two wills, the two estates can be administered in parallel, each by an executor with local authority.
Read more: Cross-border estate planning: expats, what happens to your South African assets on death?
4. You want to avoid frozen accounts and long delays for your family
Without proper cross-border planning, your loved ones can face frozen assets, conflicting legal systems and unnecessary administrative costs after your death. Two coordinated wills allow each estate to be wound up under the system it belongs to, which usually means your beneficiaries are paid out sooner.
5. Your guardianship and personal circumstances have changed
Emigration is also a good trigger to revisit the content of your will, not just its structure. If your minor children will now live abroad, guardianship clauses drafted with South Africa in mind may need to be reconsidered under the law of your new home country.
When one will may still be enough
Two wills are not compulsory for everyone. If your only offshore asset is a bank or investment account, one worldwide will is often sufficient, because foreign banks and financial institutions usually recognise a South African will that covers worldwide assets. Similarly, foreign investments administered by a South African institution can generally be dealt with by your South African executor without a separate foreign will. The deciding factors are your tax status, your residency, the type of assets you own, and the jurisdictions where they are located. This is a judgement call best made with professional advice.
The golden rule: your wills must not cancel each other out
This is the most common and most dangerous mistake. Most wills open with a clause revoking all previous wills. If you sign a new will in your new home country with a standard revocation clause, you may unintentionally cancel your South African will, and vice versa. Each will should state clearly which assets and which jurisdiction it governs, and the revocation clause should be limited so that it does not revoke the will operating in the other country. For the same reason, both wills should ideally be drafted, or at least reviewed, by advisers who are aware of each other’s documents.
Do not forget the tax and exchange control layer
Two wills solve the succession problem, but not the tax problem. If you are still a South African tax resident, section 3(2) of the Estate Duty Act 45 of 1955 means your worldwide assets count for estate duty. Also, the country where your foreign assets are located may charge its own inheritance or situs tax on that. Whether a double taxation agreement exists between the two countries matters greatly. Beneficiaries living in South Africa face exchange control rules before they can receive inheritance funds. This process varies based on whether the beneficiary has officially ended their South African tax residency. Estate planning and tax planning need to happen together.
Read more: Wills and estate planning for expats – protecting your offshore assets
South African inheritance: the bottom line
If your life now straddles two countries, your estate probably does too. A single will can leave your family navigating two legal systems with one document that fits neither perfectly. Talk to an estate planning expert in each area, and ensure the two wills complement each other. Review them whenever your situation changes. At FinGlobal, we work with South Africans across the world to coordinate their South African and foreign estate planning, and a short conversation now can save your family months of difficulty later when wanting to transfer your South African inheritance overseas.
This article is general information, not legal or financial advice. Cross-border estates depend heavily on individual circumstances and the specific countries involved, so always obtain professional advice for your situation.
Article written by Fanie Jacobs, Head of Advisory services at FinGlobal.
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