How will you be Taxed on Death?
Ruvan Grobler • October 30, 2025
It’s often said that the only certainties in life are death and taxes. While it’s not the most cheerful topic, understanding how taxes work when someone passes away can make a difficult time a little less overwhelming. This article aims to unpack the key tax considerations in a straightforward way, so you can plan ahead and ensure the estate is handled efficiently and in accordance with the law but also to give a little perspective on the advice we give as wealth managers.
Beneficiaries of deceased estates are often shocked and upset when they see the taxes payable in the estate. Understandable of course, as this eats into their inheritance.
Here are a few examples of some of the tax liabilities a deceased estate may face:
- Estate duty: Levied on the total value of your dutiable estate. 20% levied for deceased estates of more than R3 500 000 and 25% for deceased estates of more than R30 000 000.
- Transfer Duty: Levied on the transfer of ownership of immovable property from the estate to the beneficiary of the immovable property as set out in the last will.
- Income Tax:
- General Income: Income from salaried employment as well as rental income will be taken into account up to the date of death. Can include income earned as a sole proprietor.
- Income from Investments: This can be in the form of Life- or Living annuity income payments but also interest earnings from discretionary investments or savings vehicles. All rebates and exemptions for the tax year will be apportioned up to date of death.
- Capital Gains Tax: Capital gains tax can be levied on the gain that arises from the sale of assets to provide cashflow for the estate or beneficiaries. A change of ownership can also trigger capital gains tax. The annual exclusion in the year of death is R300 000 instead of the normal R40 000 annual exclusion.
It’s important to plan and make provision for these costs in your estate, there may be more moving parts if the deceased held offshore assets.
Here are a few ways to reduce your estate’s tax burden:
- Acquire (or move) assets through structures like trusts or companies.
- Invest in tax-efficient discretionary investment structures where the liability is settled in the structure and not in your personal name.
- Pre- and post-retirement investments do not form part of the dutiable estate if beneficiaries are nominated. No interest earnings- or CGT liabilities are payable on these structures.
Ruvan J Grobler RFP™ (PGDip Financial Planning)
Die woord “aftrede” is ‘n skrikwekkende woord wat jou maag laat rondtol. Wat bekommewekkend is die woordjie “stagnasie” – ‘n vrees wat met aftrede geassosieer kan word. Selfontwikkeling is nie ‘n luukse wat slegs vir sekere fases van ons lewenreis gereserveer is nie; dit is ‘n noodsaaklike en lewenslange proses wat die kwaliteit van ons menslike bestaan bepaal. In ‘n wêreld wat voortdurend verander – tegnologies, sosiaal en ekonomies – kan stilstand maklik tot agteruitgang lei. Miskien is selfontwikkeling juis te meer belangrik vir afgetredenes – dit is ‘n proses waardeer alledaagse betrokkenheid en sinvolle gesprek die waarde van jou menslike bestaan inderdaad bevestig, ondersteun en instand hou. Selfontwikkeling dra by tot persoonlike groei en selfkennis. Deur nuwe vaardighede aan te leer, kursusse te volg of bloot oor eie ervarings te reflekteer, leer jy jouself beter ken. Hierdie selfkennis help met beter besluitneming. Iemand wat byvoorbeeld besef dat hy/sy swak is in tydsbestuur, kan doelbewus strategieë ontwikkel om dit te verbeter. Vir jonger mense kan selfontwikkeling help in hulle beroepsloopbane. Deesdae met die spronge in tegnologie, is aanpasbaarheid vir nuwe uitdagings ‘n groot vereiste. Vaardighede wat vandag relevant is, kan môre verouderd wees. Deur voortdurend te leer en aan te pas, bly ‘n persoon mededingend en waardevol, spesifiek ook in jou werksomgewing. Die kern van selfontwikkeling lê in ingesteldheid. ‘n Mens moet nooit glo dat jy “klaar” is nie. Selfs op ‘n hoë ouderdom kan jy nuwe vaardighede aanleer, nuwe perspektiewe ontdek en nuwe verhoudinge bou. Hierdie ingesteldheid verhoed byvoorbeeld dat aftrede ‘n eindpunt word; dit maak dit eerder ‘n nuwe begin. Wanneer ‘n mens stagneer, verloor jy nie net jou kreatiewe energie nie, maar ook jou vermoë om sin en betekenis in jou daaglikse bestaan te vind. Elke daad van groei is ‘n daad van vernuwing, en hou die gees jonk. Om te stagneer is om jou menswees te verwaarloos; om te groei is om jou menswees te eer. Selfontwikkeling hou die vlam van betekenis aan die brand, en dit is die vlam wat die mens se lewensreis tot die einde toe verlig. Geksryf deur Koos van die Waterberge vir Bovest
In a quiet corner of a garden, a tiny egg rested beneath a leaf, unnoticed by the world. In time, it hatched into a caterpillar—small, vulnerable, and endlessly hungry. Day after day, it consumed everything in its path, growing rapidly but remaining earthbound, exposed to every passing threat. Then, without warning, it stopped. It found a still place, attached itself to a branch, and formed a chrysalis. From the outside, it looked lifeless—fragile, even pointless. To an observer, it might have seemed like the end of its journey. But inside, everything was changing. The caterpillar was breaking down completely, dissolving into something unrecognizable before slowly rebuilding itself into something entirely new. Time passed. When the chrysalis finally opened, the creature that emerged was no longer confined to the ground. Its wings were soft at first, uncertain. It struggled, pushing fluid through them, strengthening them with effort. Only after this resistance could it take flight. And when it did, it soared—no longer bound by the limitations of its former life but shaped by every stage that came before. It’s been six years since humanity’s last global threat, the Covid pandemic. A lot has changed, but we as people have not. Just as the butterfly in the story above goes through its cycle the global economy does too. But the butterfly does not know its going through this cycle, its merely following its path. We are very aware of the cycle as it has an effect on our every day lives especially on our finances. But just as the butterfly follows its path, we do too. Focus on what you can control. We often stress the issues out of our own control and isn’t exclusive to finances. Not a single person reading this article has any control of the global economy and the current conflict in the Middle East. None of us also knew exactly when it would happen and when it is going to end. Don’t get me wrong, I too struggle to manage my thoughts and emotions when we go through the tough parts. Shifting the focus towards finances; except for being in control of how you earn an income, the only other factor you can control is your spending. Stick to your budget! Never stop investing! Stay disciplined! Crisis Asset Allocation I get many questions on what we are doing to manage risk and potential losses. This is where financial planning becomes extremely important. Every single investment in your portfolio is linked to a need or a goal, not just any goal but a time-based goal. This specific time horizon has influenced the type of assets bought in order to reach these goals. The longer away the goal, the more risk is taken and vice versa. Investments where liquidity is needed will be affected much less than a long-term share portfolio. More liquidity, less risk. Meaning that if you need cashflow you should not be worried as the asset exposure will be less affected. Retirement products will have exposure to many different assets where there are conservative assets to provide protection in the short-term. The growth asset exposure that may be volatile now is the part that gives you the long-term inflation beating returns. During this part of the cycle certain assets have become less desirable and opportunities have popped up elsewhere. All portfolios are monitored to make sure that the original mandate is followed, and the investment goal is reached at the end of the applicable term. All asset managers have started to make asset allocation changes to match the changing of the cycle and the Bovest investment committee has also done so. Is it time to sell and move to cash? In short, no. We don’t know when markets will turn and no one else either. Historically in these crises it takes on average around two weeks to reach the bottom of the market and then more than a month to recover. This does create many buying opportunities for asset managers but also for you as investor. Warren Buffet always says, "Be fearful when others are greedy and greedy when others are fearful" . This is the time to buy assets on “sale”, don’t sell them. Getting out of the market is the biggest risk, this is where investors lose money. Stick to the plan and stay patient, you will be rewarded. Ruvan J Grobler RFP™ (PGDip Financial Planning)
