- Maintain a clearly written will
To avoid possible disputes after their passing, the investor should ensure that their will is written clearly and uses specific terms. Although a single will may suffice where smaller offshore investments are concerned, this may become complicated where spouses make use of a joint account. In this specific scenario, the will should state that the spouse inherits the offshore investment account.
- Jurisdiction tax obligations
‘Death taxes’ are not only applicable in South Africa. For South Africans holding offshore investments in another country that may abide by these taxes, the estate duty will be applicable on worldwide assets. Although there are some double taxation agreements in place, this may not completely mitigate the issue where Estate Duty is concerned.
- European assets
All assets located within the European Union are subject to the European Succession Regulation. This regulation determines which law applies to the succession as a whole and gives precedence to the laws of the country that holds the individual’s citizenship.
- Grant of representation
A grant of representation from a court or local advocate may be required for executors acting on behalf of deceased South African residents with offshore assets. This process can be lengthy, expensive and can delay the winding up of the estate. The bank typically requires this Grant of Representation to verify that the correct individual has authorisation over the deceased individual’s estate.
- The complication of tax reports
Tax reporting can become a complicated process, as income tax, situs and estate duty implications are involved. Depending on the investor’s circumstances, this can have various influencing factors. To ensure the accuracy of tax reports, we advise seeking the assistance of a specialist, such as those from MMS Group.
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