At the heart of any estate plan lies your will. Pair it with a file containing all the information and documents that your executor and heirs will need to wind up your estate, and you’ve laid a solid foundation for protecting your loved ones when you’re no longer around to do so.
Hopefully, most of us have already crossed those two essentials off our “to do” list. But there’s a third step which doesn’t always receive the attention it requires: planning for the costs your estate will have to pay, including a number of taxes.
As with all things to do with SARS and tax, there are many detailed requirements and grey areas involved, so what follows is a general guide only. It’s no substitute for specific professional advice.
The big costs you should plan for
CGT: The ambush tax lurking in the wings
CGT is one of those low-profile taxes that lurks around unobtrusively in the wings, being ignored and forgotten about until it suddenly pops out of the woodwork.
In this case, the “popping out of the woodwork” will happen when you’re no longer around to be ambushed by it. That’s because CGT is triggered by a taxpayer’s death, which is a “deemed disposal” tax event. In other words, your assets are deemed to have been sold at market value on the day you died. And that triggers a tax liability for your estate on the asset’s growth in value since you acquired it – the capital gain.
Before we get into the nitty-gritty of putting figures to that liability, let’s share a smidgen of good news.
The good news: 3 big exclusions, boosted by Budget 2026
Note firstly that no CGT at all is payable on “personal-use assets”, retirement fund benefits and most mainstream life policies.
Secondly, there’s “spousal rollover relief”: liability for CGT on assets left to your spouse is “rolled over” so that it’s payable not by your estate but later on by your spouse (on sale) or by their estate (on death). That, of course, can make a tremendous practical difference in ensuring that your spouse will be okay financially.
Thirdly, the annual exclusion in year of death, the primary residence exclusion and the small business disposal exclusion can all reduce CGT substantially. And as we note below, Budget 2026 has boosted them all. Good news indeed!
How to calculate CGT
Now for the actual CGT calculation, which will give you a rough idea of the final liability so you can plan for it:
Putting together a comprehensive estate plan, anchored by your will, is essential to ensure that your loved ones are properly catered for after you’re gone. You know who to call if you need any help!
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.
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