For those left behind when a loved one dies, settling an estate can seem overwhelming and full of unanswered questions. Rumana Mahomed Let's break down the process to make it a little easier.
We all need to play the “what if” game with confidence, knowing that we can succeed regardless of unknown circumstances.
This game guarantees:
Each of our properties, large or small, is subject to legal proceedings. This process is administratively burdensome and can be very complex depending on the circumstances of each property. Your goal may simply be to ensure that you, or those you leave behind, are supported by a legal professional or certified trustee with expertise in the law and estate administration process.
Such support will definitely help you and those you leave behind to move through this process more effectively and quickly.
But even with support, there may still be concerns about the “what ifs” and the problems that could arise if you or a loved one were to die today.
Therefore, you should start by understanding the process of liquidating an estate. This is the first step to success in the “what if” game.
One important point to note is that in South Africa, the Chief Justice of the High Court classifies deceased estates into two categories based on values.
- Properties valued at less than R250,000 that do not need to go through a full liquidation process.and
- Property valued at R250,000 or more.
Estates must be reported to the office of the Chief Justice of the High Court closest to the deceased's place of residence. You must submit the following documents:
- Original will (if any).
- A certified copy of the death certificate; and
- and various other supporting documents and forms.
Step 2: Open a real estate account
Next, the executor must open an estate delay bank account where the deceased's money can be disbursed and debts settled.
In that case, the executor must notify the debtor and creditor through advertisements or contact them directly.
The enforcer must also notify the South African Revenue Service (SARS).
After this, the executor must investigate, verify, and value each asset and liability owned by the deceased.
Any outstanding debts owed by the deceased must be cleared. This may include selling assets to cover debts.
Step 3: Prepare your L&D account
The executor must then prepare and file a liquidation and distribution account based on the information collated in step 2. This account lists the property and its debts. This report must be submitted to the Chief Justice of the High Court for review and approval within six months of the executor's appointment.
Step 4: Acknowledge the objection
The executor must then provide an opportunity for all interested parties to view and object to the approved liquidation and distribution account within 21 days through a second advertisement.
Please note that SARS is not limited to this period.
If the account is not disputed, the Chief Justice will authorize the executor to distribute the remaining assets of the estate to the beneficiaries in accordance with the will or intestacy laws after clearing the outstanding debts and taxes .
Step 5: Answer the remaining questions
The final step in closing the estate is to respond to any remaining questions raised by the Master and submit evidence to the Master of the High Court that the inheritance has been received.
By understanding this process of settling your estate, you can make decisions during your lifetime that will positively impact the inevitable process that will unfold when you are no longer here and will help those left behind. We can help answer some of these “what ifs”.
This article was first published on SmartAboutMoney.co.za., Initiatives by the South African Savings and Investment Association (Asisa).
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