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The loss of a loved one is a traumatic event, and unfortunately, when a person passes away, all is not over with the burial. The deceased person’s estate has to be wound up in accordance with specific legislation and regulations prescribed by the Master of the High Court, which can be a long, tedious and drawn out process. The administrative burden of the winding up of a deceased estate, in the absence of an experienced executor, can be very difficult and stressful to deal with when one is trying to mourn the loss of a loved one.
An experienced executor is there to take this administrative burden off the shoulders of family members, and deal with the winding up of the deceased estate in a smooth and efficient way.
The executor would be involved in the following steps when winding up a deceased estate:
Obtaining “Letters of Executorship” from the Master of the High Court
This requires lodging a number of certified documents (Death certificate, ID book, Last Will and Testament) and prescribed forms (such as Inventory list, Death notice, Acceptance of trust as executor, marriage declaration) to the Master of the High Court. The Master of the High Court then opens up a file and allocates a specific registration number to the deceased estate.
Advertising for creditors
An advertisement needs to be placed in both a local newspaper and the Government Gazette notifying creditors of the death of the person. The advertisement gives possible creditors 21 days to come forward with any claims against the estate.
Opening an “Estate Late” bank account
A bank account is opened in the name of the deceased person’s estate, into which all proceeds from the sale of investments, and the like, are deposited. An Estate Late bank account is an interest bearing account, from which account creditors are paid. Once the account creditors are paid, the remaining balance will be used to pay executors fees and distributed to beneficiaries as identified in the last will and testament of the deceased person.
Closing other bank & investment accounts
Bank accounts that were in the name of the deceased person while he was alive are closed. Instructions and documents need to be sent to investment houses to either sell investments, or transfer investments into the names of the beneficiaries as stipulated in the last will and testament of the deceased person.
Preparation of the Liquidation & Distribution Account
This Liquidation & Distribution Account needs to be drawn up, as per the regulations, and sent to the Master of the High Court for approval.
Advertising of Liquidation & Distribution Accounts
Once the Liquidation & Distribution Account has been approved by the Master of the High Court, the Executor must place another advertisement into a local newspaper and Government Gazette where notice is given that the public have the right to inspect these accounts for a period of 21 days and raise objections if necessary.
Notifying SARS and finalising any outstanding tax matters
SARS needs to be notified that the person has passed away, so that the deceased person can be removed from the tax system. However before SARS can do this, the Executor needs to ensure that any outstanding tax returns are submitted. The Executor must pay any outstanding taxes over to SARS, as well as completing the estate duty return. Estates which have a value of less than R3 500 000 are exempt from Estate Duty.
Distribution of the estate in terms of the last Will and testament
Once all of the above has been complied with, the remaining assets are distributed to the beneficiaries as stipulated in terms of the most recent will of the deceased person.
The winding up of a deceased estate is no simple quick task. At best, it can take anywhere between 6 and 9 months to wind up a deceased estate. It is a drawn out process which nobody should have to deal with while grieving the loss of a loved one.
It is advisable to let an experienced executor take that administrative burden, and the stress of dealing with the matter, off your shoulders. This will allow you to focus on the more important things while you deal with the loss of a family member or friend.
