In his infinite wisdom, Chuck Norris said, “Between income taxes, employment taxes, capital gains taxes, estate taxes, corporate taxes, property taxes, and Social Security taxes, we're being taxed to death.”
Chuck has a good point. Let’s explore estate duty, a death tax in beautiful South Africa. Last time, we examined the rate at which estate duty is taxed in South Africa. Chuck Norris might never die, so he can probably ignore estate duty. However, executors of estates must be familiar with it.
According to Section 11, read with Section 12 of the Estate Duty Act (“the Act”), the executor will most likely be liable to pay the estate duty. If the Commissioner of SARS raised an assessment under Section 9 of the Act, please pay the duty by the date prescribed on the assessment. Suppose estate duty remains unpaid after 30 days from the prescribed date. In that case, 6% interest per year will be payable on the outstanding duty calculated from the expiration date (30 days from the prescribed payment date) to the payment date.
But what if you do not receive an assessment from SARS, and the duty assessment is “delayed” beyond 12 months from the date of death? Well, first of all, this will be in most cases…secondly, NO, you are not on the hook to pay estate duty. After 12 months, the estate must pay 6% annual interest on the outstanding duty.
Thus, if you have not received an assessment and 12 months from the date of death is slowly ending, pay the amount calculated by you or a specialist tax practitioner, or at least a deposit as close as possible to the estimated amount. SARS will still have to assess, but at least you mitigated the interest as much as possible. If you have made an overpayment, SARS will refund the estate.
Estate duty is paid by loading a credit push on e-filing. Do not try to pay an eft to SARS, as you will be frustrated.
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