A trust does not enjoy any exemptions on interest or capital gains either. If your individual tax rate is lower you should reconsider. ![]() Trusts are taxed at the highest rate of 45%. These costs will need to be weighed up against the benefits that the trust provides in the event of your death. Trusts have to prepare financials and submit tax returns which incur accounting fees and costs. ![]() The running of trust comes with administrative responsibilities. So if your estate is under R7 000 000 the benefit of a trust is limited. The R3 500 000 passes onto the surviving spouse leaving up to R7 000 000 as a deduction on the value of assets before estate duty is applied. It is paid when the surviving spouse passes on. If you leave everything to your spouse there is no estate duty payable on your death. ![]() Here are 3 reasons why trust is not that beneficial for you:Īll taxpayers receive a deduction of R3 500 000 from the value of their assets in their estate before the estate duty of 20% is applied. It is managed by trustees in terms of a trust deed which details how the assets should be distributed. A trust is a legal entity which controls assets on behalf of its beneficiaries.
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