Estate duty after the section 4A abatement, at 20% or 25%.
Estate duty
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Dutiable amount
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Net estate after duty
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Your breakdown
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What dies with you, and what gets taxed
Estate duty is the tax on what you leave behind. When you die, an executor adds up everything you owned, your property, investments, vehicles, and the proceeds of certain policies, to arrive at the gross estate. From that, the law lets the estate subtract debts, the cost of administering the estate, anything left to a surviving spouse, and a flat allowance called the section 4A abatement. Whatever remains is the dutiable amount, and that is what estate duty is charged on. This calculator runs exactly that sequence, which is why it asks for the gross estate, liabilities and deductions, and any bequest to a spouse as three separate inputs.
The R3.5 million abatement and the spouse rollover
The single most important number for most estates is the section 4A abatement, which the calculator applies at R3,500,000. It is a flat deduction every estate gets before any duty is calculated, so an estate with a dutiable value below R3.5 million typically pays no estate duty at all. There is a powerful extension that this tool captures through its spouse field: anything you leave to a surviving spouse is fully deductible, so it passes free of estate duty. Better still, any unused portion of your abatement rolls over to your spouse, meaning the survivor can effectively have up to R7 million in abatement on the second death. This is why couples are often advised to leave assets to each other first. Treat the R3.5 million figure as the calculator's assumption to confirm with SARS, the South African Revenue Service, since allowances do get revised.
Working an R12 million estate with no spouse bequest
Suppose someone dies with a gross estate of R12,000,000 and R1,500,000 of liabilities and deductions, leaving nothing to a spouse. The calculator subtracts the R1,500,000 and then the R3,500,000 abatement, leaving a dutiable amount of R7,000,000. Because that sits comfortably below the R30 million mark where the rate steps up, the whole amount is taxed at the lower band. Using the rates this calculator applies, that is 20 percent of R7,000,000, which is R1,400,000 of estate duty. After settling the debts and the duty, the estate that flows to heirs is about R9,100,000.
When 25 percent kicks in
The calculator splits the dutiable value across two bands. The rates this tool applies are 20 percent on the first R30 million of dutiable value and 25 percent on anything above that line. For the vast majority of estates the 25 percent band is irrelevant, but for genuinely large estates it changes the marginal cost of every extra rand. The R30 million threshold is the calculator's working assumption, so confirm both the rates and the breakpoint with SARS rather than treating them as settled. One subtlety the tool does not show: estate duty interacts with capital gains tax, because death is treated as a disposal of assets for CGT purposes, so a large estate can face both a CGT bill in the final return and estate duty on what remains.
Who needs to think about this now
If your home, retirement savings, and investments together approach or exceed the R3.5 million abatement, estate duty stops being theoretical. The common mistake is forgetting that life policy proceeds payable to your estate are added to the gross estate and can push an otherwise modest estate over the line. A practical tip is to check whether your policies pay to your estate or to a named beneficiary, because the routing affects both the duty and how quickly heirs get the money. Run your own numbers above, then take the output to an estate planner, and verify the abatement and rates against the current SARS position before relying on the figure.
Are my retirement fund savings included in my estate for duty?
Generally no. Approved retirement fund benefits, such as pension, provident, and retirement annuity proceeds, usually fall outside the estate for estate duty because they are distributed under separate fund rules. That makes retirement funds an efficient way to pass on wealth, though the trustees decide how benefits are allocated to dependants. Confirm the treatment of your specific fund, because contributions that did not qualify for a deduction can be handled differently.
Who actually pays the estate duty, the heirs or the estate?
The estate pays it before assets are distributed, so heirs receive what is left after duty rather than getting a separate bill. This is exactly why estate liquidity matters: if the estate is mostly property with little cash, the executor may have to sell an asset to fund the duty. Planning ahead with cash or life cover earmarked for the estate avoids a forced sale.