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Deceased Estate administration in South Africa 2024

Deceased estates can be tracked online these days; the Master’s Office has a case management system which allows public access through a portal.

Deceased estate administration

When a loved one dies the Executor nominated in the Deceased’s last will and testament should be contacted. The process of administering a deceased estate (managing and winding) is prescribed by the Administration of Estates Act of 1965. It is a complex process and therefore best to ensure that an attorney experienced in Estates is nominated as executor in terms of your Will. If an inexperienced person is appointed as executor, they will often appoint specialists to assist them, e.g.:

• Conveyancers to assist with transfers of property in the deceased estate.
• Attorneys to assist with any litigation there may be.
• Attorneys to assist with winding up the deceased estate.

To practically effect this, the executor would sign a special power of attorney authorizing the specialist lawyers to do the work on his/her behalf.

The type of appointments the executor makes and documents required to report an estate depends on the value of the Estate:

• If the value of the Estate is less than R250 000; the Master does not appoint an Executor but rather a Master’s Representative is appointed in terms of Section 18(3) of the Administration of Estates Act of 1965. The Master’s Representative administers the estate without following the full procedure set out in the Act. It is a simpler, quicker process.
• If the value of the Estate is greater than R250 000 the Master will appoint Letters of Executorship, an Executor is appointed who follows the full process of winding up of the Estate as set out in the Administration of Estates Act of 1965.

Assets & Liabilities

The Executor needs to gather information about the deceased’s assets and debts; which may include:

• Property (the executor may hire conveyancing attorneys to assist with the transfer of property to those inheriting it)
• Shares (see Computershare deceased estate resources)

The Process of winding up the estate

1. If the deceased left a Will it would usually nominate an executor who will manage the winding up of the estate. If there is no Will or executor nominated one should be nominated by the heirs.
2. The Executor should gather as much information relating to assets; debts and possessions of the deceased.
3. The Executor must apply to the Master of the High Court for Letters of Executorship to be issued. This process involves submitting to the Master :
   1. The Death Certificate and Notice.
   2. Original Will.
   3. An Inventory.
   4. Acceptance of Trust as Executor.
4. Once the Letters of Executorship is issued, A Notice for debtors and creditors to lodge claims against the estate must be published in the Government Gazette and in a newspaper.
5. The Executor then drafts a Liquidation and Distribution Account on the basis of claims received. The account sets out assets, liabilities and administration costs and how assets are divided.
   1. The Liquidation Account is submitted to the Master for examination. There are fourteen Masters' Offices in South Africa. The examination takes approximately 2 months. The Master will issue a query sheet setting out any further requirements prior to advertising the Liquidation and Distribution.
   2. The Account is advertised in the Governement Gazette and newspaper. The Account lies open for 21 days for any objections to be made thereto.
   3. If there are no objections the executor can finalise the estate; pay creditors; handover inheritance to heirs and transfer fixed property to heirs.
   4. The Executor then provides proof to the Master that all creditors have been paid and heirs received their inheritances.
      

Deceased estate administration costs

A brief overview of costs :

1. The Executors remuneration is up to 3,5% plus VAT on the gross estate value; and 6% plus VAT on the income accrued after death. The remuneration can be negotiated.
2. Estate Duty is payable to SARS. Currently Estate Duty is payable if the estate value is over R3,5 Million Rand; 20% on the first R30 Million; and 25% for any value over R30 Million.
3. Advertising costs are dependent on the newspaper used and are estimated at R1200.
4. Master’s Fees are calculated according to a tariff. The amount levied depends on the value of the Estate.
5. Other costs :
   • Conveyancing costs and costs associated with the transfer of property.
   • Tax Consultants costs.
   • Litigation costs.
   • Bank costs.

Insolvent deceased estate

If an Estate is found to be insolvent the Estate is administered in terms of Section 34 of the Administration of Estates Act.

Administration Systems for Deceased Estates

The Lexis® Deceased Estates administration system is widely used to transparently and speedily wind up estates; as is the LegalEase Deceased Estates Software (phone +27-31-9407215 for more info).

Masters' Office inefficiencies

There is a Chief Masters Office and local masters offices spread out around South Africa; with service levels differing per office. As sketched out above, the Executor must engage with the Masters' office (of the High Court) on numerous issues. Delays caused by inefficiences in the Masters' office result in beneficiaries of deceased estates experiencing delays in receiving their beneits.

Home Affairs link with Masters' Office

There is a (sometimes tricky) interlink between the masters' office, home Affairs and the Justice Department. For example, the Masters' office needs to confirm the status of a person that is deceased with Home Affairs; as well as when establishing the next of kin if the deceased did not leave a valid will.

Systems often offline

The below SABC News video contains an interview with somebody who, as she is over 18, needs to claim directly from the Guardian's Fund. The first time she went there was a network issues, the second time there was an issue with the GEPF letter she had, after changing it the third and fourth times she went there was no network again.

The masters office is in the process of storing files offsite and digitising its files, and facilitating making online bookings. The issuing of letters of executorship had a backlog asa result of COVID, and the issue was further exacerbated by a ransomware attack.

If an executor dies

If the appointed executor dies his office is terminated automatically. A new Executor is nominated by the heirs and must apply to the Master to be appointed as Executor.

Unclaimed deceased estates

Unclaimed monies in a Deceased Estate are paid to the Guardian’s Fund. Inheritances due to Minors are often paid to the Guardian’s Fund if the Will does not stipulate that the funds will be held in trust for the benefit of a Minor or if the deceased died intestate, without leaving a Will.

Another instance where funds may be paid to the Guardian’s Fund is if an heir cannot be traced. Once the minor turns 18 or an heir comes forward he would need to make application to the Fund for payment. After 30 years of the funds being claimable by an heir the money is forfeited for the State.

Books: Meyerowitz on deceased estates

Most executors look to reference the books by Meyerowitz on deceased estates, for best practice; e.g. "Meyerowitz on the Administration of Estates and their Taxaction"

UK Law : Probate process

If you are familiar with UK law, you may understand the UK's "probate process"; applying for probate joint executors and the UK's probate court for deceased person. The UK's probate process relates to the process of winding up a Will or Estate in England under the Probate Act. South African Law for winding up estates is similar to the English probate process.

Executors / administrators of deceased estates

Click here to see some options for deceased estate administrators.

Declining nomination as executor

If the estate is too small, corporates sometimes decline their nomination as executor; and send a communication along the lines of the following to the Master of the High Court: "We enclose the original will of the deceased for your attention. As the total value of the assets currently reported to use is below R250,000 and can be administered in terms of Section 18(3) of the Act, we decline our nomination as Executor. Should additional assets be reported and the total value of the estate exceed R250,000, please approach us with a view to administering the estate. Yours faithfully, Nominated Executor."

Suing a deceased estate

Suing a deceased person is possible by suing the estate of the deceased person. We can see that this thought did not escape the City of Cape Town, when they were writing this indemnity for the De Villiers Dam on top of Table Mountain: "This indemnity is effective and binding on all persons, including heirs, next of kin, executors, administrators and assigns."

Deceased Estate Information

If a relative has died, perhaps without a will, and you are unsure of what do:

• Steps to take when your parent dies without a will.
.
• Deceased estate administrators in Cape Town.
• Letter of executorship requirements in South Africa.
• Administration of deceased estates in South Africa.
• Cost of transferring property that you inherit in a deceased estate.
• Inheritance and child maintenance obligations.

Wills

• How to write a will.
• Example of a last will and testament.
• Get your will drafted for free (by a lawyer).
• List of lawyers that draft wills in Cape Town.
• Consider updating your will when these events occur:
  • when divorcing; to avoid your ex-spouse possibly inheriting everything.
  • death of somebody mentioned in your will,
  • the birth of a child you may want to include in your will,
  • marriages

Deceased Estate discussion forum

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