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| ESTATE PLANNING No Estate Planning should ever be done in isolation For this reason it is essential that the person assisting you with Financial Planning know your aims and objectives as to the disposition of your assets amongst your beneficiaries after death. Benefits of early planning Planning for your heirs. Arranging for the transfer of your property from one generation to your family or perhaps others. All the assets and liabilities of the deceased, as at the date of death, form part of the estate. You do not want to expose the estate to unnecessarily estate tax. Through the proper planning of your will, you should try to minimize the potential estate taxes. There should be sufficient cash to cover this tax, to avoid a forced sale of assets. Estate planning is therefore necessary for all persons, regardless of the size of their estates. The planning process Start collecting the following documents and facts for your financial advisor. You and your spouse's full names, identity numbers, addresses and occupations. Your marriage status: in or out of community of property, with or without accrual. Family details, including your children's names and dates of birth (all marriages separately). Comprehensive information regarding assets and liabilities, including all values thereof. Details of group insurance, pension and insurance not payable to your estate. Particulars of any limited interest received from the estate of a deceased spouse or any other person. Maintenance responsibilities and agreements/contracts. Particulars of overseas assets and liabilities. Personal preferences for the division of assets. Draw up a list of your financial needs and wishes for the future, as well as your wishes for the division of your assets after you die. Your asset mix may have to be adjusted, which means that you may have to form a company, a closed corporation or a trust. This may also mean that you would have to draw up a new will or adjust your current will. Have a practically executable and well-planned will drawn up by making an appointment with your financial advisor, broker or expert. Costs Before you start with a comprehensive estate planning exercise, you should know what the costs involved are. There is a fee for professional advice. Negotiate with your advisor about this before you start with the estate planning. During your first meeting already your estate planner will give you an indication of the total costs of a comprehensive estate plan. Master's fees payable to the Master of the High Court is subject to a maximum fee of R600. |
Why do I need a will? Every competent person of 16 years and older who owns assets and is mentally able to understand the results of his or her actions, should have a will. Why? If a person dies without a will, it could lead to severe administrative, tax and legal problems and possibly also lead to financial losses. A will should comply with certain legal requirements to be valid. In your will, you determine how your assets should be devided, and nominate an executor and trustee to take care of the division of the estate's assets and to handle the administration of any trust assets. You have the right to name heirs as you wish in your will. If you don't, your assets will be divided according to the Intestate Sucession Act, No 81 of 1987, after your death - which could mean that persons who you would have preferred not to inherit from you, could inherit. You will therefore determines the future of everything that youv'e built up through the years - and your heirs can be directly disadvantaged if you don't plan correctly. Estate duty, income tax, VAT and capital gains tax (CGT) can take a big chunk of your estate if your planning is wrong. We can help you with expert advice. The Will still remains one of the most important documents that a person will sign during his lifetime. It is the most important instrument used in Estate Planing, particularly with bequests to surviving spouses, and the advantage that it can be reviewed and revised as often as necessary in the light of changing family or financial circumstances. A Will is the only means by which the deceased estate can be distributed among his heirs according to his wishes. Some assets could be in the name of the husband. But on his wife's death he could find himself virtually dispossessed of half of "his" assets, if his wife had no Will, or if she had an old Will, which was drawn up before the value of the assets, were significant. Contact us: E-mail: cobans@mweb.co.za Tel: +2712 653-4153 |
TAX PLANNING Anyone earning taxable income has to pay normal tax. If your estate is not planned early and thoroughly, it may unnecessarily expose the estate to estate tax. You should at all times try to minimize the potential estate taxes through the proper planning of your will, and also ensure that there is sufficient cash to cover this tax. If not, it may lead to a forced sale of assets. Annual Review
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