Category: Estate Duty Act 45 of 1955

Section 28 (Estate Duty Act) – Offences

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28. Offences

[Heading of section 28 substituted by section 271 of Act 28 of 2011 effective on 1 October 2012]

(1)     ……….

[Subsection (1) amended by section 7 of Act 81 of 1965 and section 11 of Act 30 of 2000 and repealed by section 271 of Act 28 of 2011 effective on 1 October 2012]

(2)     Any person who –

(a)     ……….

[Paragraph (a) deleted by section 9 of Act 81 of 1985]

(b)     ……….

[Paragraph (b) repealed by section 271 of Act 28 of 2011 effective on 1 October 2012]

(b)bis         ……….

[Paragraph (b)bis inserted by section 17 of Act 77 of 1962, substituted by section 8 of Act 46 of 1996 and repealed by section 271 of Act 28 of 2011 effective on 1 October 2012]

(c)     fails to comply with any reasonable requirement of the Commissioner or Master made for the purpose of carrying out any provision of this Act; or

(d)     obstructs or hinders the Commissioner or Master in carrying out any provision of this Act,

shall be guilty of an offence and liable on conviction to a fine or to imprisonment for a period not exceeding two years.

[Subsection (2) amended by section 7 of Act 81 of 1965, section 12 of Act 97 of 1993 and section 11 of Act 30 of 2000]

Section 7 (Estate Duty Act) – Rendering of returns

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7. Rendering of returns

 

(1)     Every executor or, if he is called upon by the Commissioner to do so, any person having the control of or any interest in any property included in the estate, shall submit to the Commissioner a return disclosing the amount claimed by the person submitting the return to represent the dutiable amount of the estate together with full particulars regarding –

[Words preceding paragraph (a) substituted by section 271 of Act 28 of 2011 effective on 1 October 2012]

 

(a)     the property of the deceased as at the date of his death;

(b)     property which, in accordance with subsection (3) of section 3, is deemed to be property of the deceased as at that date;

(c)     any deduction claimed in terms of section 4.

 

(2)     ……….

[Subsection (2) deleted by section 271 of Act 28 of 2011 effective on 1 October 2012]

Section 4A (Estate Duty Act) – Dutiable amount of an estate

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4A.    Dutiable amount of an estate

 

(1)     Subject to subsections (2) and (3), the dutiable amount of the estate of any person shall be determined by deducting from the net value of that estate, as determined in accordance with section 4, an amount of R3,5 million.

 

(2)     Where a person was the spouse at the time of death of one or more previously deceased persons, the dutiable amount of the estate of that person shall be determined by deducting from the net value of that estate, as determined in accordance with section 4, an amount equal to the amount specified in subsection (1)-

 

(a)     multiplied by two; and

(b)     reduced by the amount deducted from the net value of the estate of any one of the previously deceased persons in accordance with this section.

 

(3)     Where a person was one of the spouses at the time of death of a previously deceased person, the dutiable amount of the estate of that person shall be determined by deducting from the net value of that estate, as determined in accordance with section 4, an amount equal to the sum of-

 

(a)    the amount specified in subsection (1); and

(b)     the amount specified in subsection (1) divided by the number of spouses, reduced by an amount which is determined by dividing the amount deducted, in accordance with this section, from the net value of the estate of the previously deceased person by the number of spouses of that previously deceased person.

[Paragraph (b) substituted by section 4 of Act 7 of 2010 effective on 1 January 2010]

 

(4)     The amount contemplated in subsection (2)(b) or (3)(b) shall not exceed the amount specified in subsection (1).

 

(5)     Subsections (2) and (3) shall not apply unless the executor of the estate of that person submits, at the time and in the manner and form prescribed by the Commissioner, to the Commissioner a copy of a return submitted to the Commissioner in terms of section 7 or other relevant material that the Commissioner may regard as reasonable in respect of the estate of the previously deceased person.

[Subsection (5) substituted by section 2 of Act 15 of 2016 effective on 19 January 2017]

 

(6)     Where a person and his or her spouse die simultaneously, the person of whom the net value of  the estate, determined in accordance with section 4, is the smallest must be deemed for the purposes of this section to have died immediately prior to his or her spouse.

[Subsection (6) added by section 4 of Act 7 of 2010 effective on 1 January 2010]

[Section 4A inserted by section 6 of Act 92 of 1971, amended by section 3 of Act 95 of 78, section 5 of Act 102 of 1979, section 12 of Act 106 of 1980, section 4 of Act 99 of 1981, section 6 of Act 81 of 1985 and section 2 of Act 71 of 86, substituted by section 11 of Act 87 of 1988, amended by section 5 of Act 30 of 2002 and section 17 of Act 9 of 2006 and substituted by section 1 of Act 8 of 2007 and section 5 of Act 17 of 2009]

Section 4 (Estate Duty Act) – Net value of an estate

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4. Net value of an estate

The net value of any estate shall be determined by making the following deductions from the total value of all property included therein in accordance with section 3, that is to say –

(a)     so much of the funeral, tombstone and death-bed expenses of the deceased which the Commissioner considers to be fair and reasonable;

[Paragraph (a) substituted by section 8 of Act 97 of 1993]

(b)     all debts due by the deceased to persons ordinarily resident within the Republic (other than any debt which constitutes a claim by such a person to property donated by the deceased in terms of a donation which was exempt from donations tax under section 56(1)(c) or (d) of the Income Tax Act, 1962 (Act No. 58 of 1962)), which it is proved to the satisfaction of the Commissioner have been discharged from property included in the estate;

[Paragraph (b) substituted by section 6 of Act 31 of 2005 with effect from 8 November 2005]

(c)     all costs which have been allowed by the Master in the administration and liquidation of the estate, other than expenses incurred in the management and control of any income accruing to the estate after the date of death;

(d)     all expenditure incurred in carrying out the requirements of the Master or the Commissioner in pursuance of the provisions of this Act;

(e)     the amount included in the total value of all property of the deceased as representing the value of any right in or to property situate outside the Republic acquired by the deceased –

(i)      before he became ordinarily resident in the Republic for the first time; or

(ii)     after he became ordinarily resident in the Republic for the first time, by –

(aa)   a donation if at the date of the donation the donor was a person (other than a company) not ordinarily resident in the Republic; or

(bb)   inheritance from a person who at the date of his death was not ordinarily resident in the Republic; or

[Subparagraph (ii) substituted by section 1 of Act 104 of 1976]

(iii)    out of the profits and proceeds of any such property proved to the satisfaction of the Commissioner to have been acquired out of such profits or proceeds;

[Paragraph (e) substituted by section 3 of Act 65 of 1960]

(f)      any debts due by the deceased to persons ordinarily resident outside the Republic (other than any debt which constitutes a claim by such a person to property donated by the deceased in terms of a donation which was exempt from donations tax under section 56(1)(c) or (d) of the Income Tax Act, 1962 (Act No. 58 of 1962)), which have been discharged from property included in the estate to the extent that the amount of such debts is proved to the satisfaction of the Commissioner to exceed the value of any assets of the deceased outside the Republic and not so included;

[Paragraph (f) substituted by section 6 of Act 31 of 2005 with effect from 8 November 2005]

(g)     the value of any interest included as property of the deceased under paragraph (a) of subsection (2) of section three where such interest was held by the deceased by virtue of a donation to him by the person to whom the right of enjoyment of the property in which the deceased held the interest, accrues or, where the interest consists of a right to an annuity charged upon property, by the person who is the owner of that property;

(h)     the value of any property included in the estate which has not been allowed as a deduction under any other provision of this section which accrues or accrued to –

(i)      any public benefit organisation which is exempt from tax in terms of section 10(1)(cN) of the Income Tax Act, 1962 (Act No. 58 of 1962); or

[Subparagraph (i) substituted by section 8 of Act 97 of 1993 and section 8 of Act 30 of 2000]

(iA)   any institution, board or body, which is exempt from tax in terms of section 10(1)(cA)(i) of the Income Tax Act, 1962 (Act No. 58 of 1962), which has as its sole or principal object the carrying on of any public benefit activity contemplated in section 30 of that Act; or

[Subparagraph (iA) inserted by section 4 of Act 30 of 2002]

(ii)     ……….

[Subparagraph (ii) deleted by section 8 of Act 30 of 2000]

(iii)    the State or any “municipality” as defined in section 1 of the Income Tax Act, 1962 (Act No. 58 of 1962); or

[Subparagraph (iii) substituted by section 2 of Act 20 of 2006]

(iv)    ……….

[Subparagraph (iv) amended by section 7 of Act 27 of 1997 and deleted by section 8 of Act 30 of 2000]

(v)     ……….

[Subparagraph (v) added by section 3 of Act 20 of 94 and deleted by section 7 of Act 27 of 1997]

[Paragraph (h) amended by section 9 of Act 71 of 1961 and section 3 of Act 81 of 1965, substituted by section 6 of Act 86 of 1987 and section 10 of Act 87 of 1988 and amended by section 4 of Act 30 of 2002 and section 5 of Act 74 of 2002]

(i)      the amount by which the value of any property included in the estate has been enhanced by any improvements made to the property concerned –

(i)      at the expense of the person to whom such property accrues on the death of the deceased; and

(ii)     during the lifetime of the deceased and with his consent;

(j)      the amount by which the value of any fiduciary, usufructuary or other like interest which ceased upon the death of the deceased has been enhanced by any improvements made to the property concerned –

(i)      at the expense of the person to whom the benefit arising by reason of the cessation of such interest upon the death of the deceased, accrues; and

(ii)     during the lifetime of the deceased and with his consent;

(k)          ……….

[Paragraph (k) substituted by section 9 of Act 77 of 1964, section 3 of Act 81 of 1965, section 2 of Act 94 of 1967 and section 2 of Act 70 of 1975, amended by section 4 of Act 102 of 79 and section 11 of Act 106 of 1980 and deleted by section 10 of Act 87 of 1988]

(l)           ……….

[Paragraph (l) added by section 2 of Act 59 of 1957, substituted by section 9 of Act 71 of 1961, section 9 of Act 77 of 1964, section 3 of Act 81 of 1965, section 2 of Act 94 of 1967, section 5 of Act 92 of 1971, section 2 of Act 70 of 1975 and section 1 of Act 104 of 1976, amended by section 4 of Act 102 of 1979, section 11 of Act 106 of 1980 and section 3 of Act 99 of 1981 and deleted by section 10 of Act 87 of 1988]

(lA)   the amount of any claim against the estate acquired under section 3 of the Matrimonial Property Act, 1984 (Act No. 88 of 1984), by the surviving spouse of the deceased or by the estate of his deceased spouse, in respect of an accrual contemplated in that section;

[Paragraph (lA) inserted by section 5 of Act 81 of 1985]

(m)    the value of any usufructuary or other like interest in property and of any right to an annuity charged upon property, included as property of the deceased under section 3(2)(a), if such interest or right was created by a predeceased spouse of the deceased and –

(i)      the property over which the deceased enjoyed such interest or right formed part of the estate of such predeceased spouse; and

(ii)     no deduction in respect of the value of such interest or right was allowable in the determination of the net value of the estate of the predeceased spouse under the provisions of paragraph (q) of this section;

[Subparagraph (ii) substituted by section 14 of Act 30 of 1998]

[Paragraph (m) added by section 2 of Act 59 of 1957 and substituted by section 6 of Act 86 of 1987 and section 10 of Act 87 of 1988]

(n)     ……….

[Paragraph (n) added by section 2 of Act 59 of 1957 and deleted by section 10 of Act 87 of 1988]

(o)     any amount included in the estate in respect of –

(i)      the value of books, pictures, statuary or other objects of art; or

(ii)     so much of the value of any shares in a body corporate as is attributable to such body’s ownership of books, pictures, statuary or other objects of art,

if such books, pictures, statuary or other objects of art have been lent under a notarial deed to the government of the Republic in the national, provincial or local sphere for a period of not less than thirty years, and the deceased died during such period;

[Words following subparagraph (ii) substituted by section 3 of Act 31 of 2013 effective on 12 December 2013]

[Paragraph (o) added by section 9 of Act 71 of 1961 and amended by section 10 of Act 87 of 1988]

(p)     so much of the value of any property deemed to be property of the deceased by virtue of the provisions of section 3(3) as has not been deducted under any of the other provisions of this section and as the Commissioner is satisfied has been taken into account under the provisions of section 5(1)(f)bis in the determination of the value of any company shares or a member’s interest in a close corporation included as property in the estate;

[Paragraph (p) added by section 9 of Act 77 of 1964 and substituted by section 8 of Act 97 of 1993]

(q)     so much of the value of any property included in the estate which has not been allowed as a deduction under the foregoing provisions of this section, as accrues to the surviving spouse of the deceased: Provided that –

(i)      the deduction allowable under the provisions of this paragraph shall be reduced by so much of any amount as the surviving spouse is required in terms of the will of the deceased to dispose of to any other person or trust;

(ii)     no deduction shall be allowed under the provisions of this paragraph in respect of any property which accrues to a trust established by the deceased for the benefit of the surviving spouse, if the trustee of such trust has a discretion to allocate such property or any income therefrom to any person other than the surviving spouse.

[Paragraph (q) added by section 5 of Act 81 of 1985 and substituted by section 6 of Act 86 of 1987]

[Section 4 amended by section 5 of Act 92 of 1971]

Section 2 (Estate Duty Act) – Levy of estate duty

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2. Levy of estate duty

(1)     There shall be charged, levied and collected in respect of the estate of every person who dies on or after the first day of April, 1955, a duty to be known as an estate duty.

(2)     Estate duty shall be charged upon the dutiable amount of the estate calculated in accordance with the provisions of this Act, and shall be levied at the rate set out in the First Schedule.

[Subsection 2 amended by section 8 of Act 87 of 1988]