A trust creates a separate entity that is allowed to own assets and, through the trustees, transact in its own name. Individuals are therefore protected in their private capacity, as well as protected in their capacity as trustees.

A trust is an entity that has the ability to outlive the founder. In the event of an individual passing away, the trust will continue to operate as normal and will not incur any unnecessary taxes or forced sales of assets.


An “inter vivos” trust is established during the founder's lifetime. The process of registering a trust is fairly easy, but it is of utmost importance to consult with an experienced trust specialist to draft the trust deed. The trust deed is the contract that dictates the relationship between you as the founder and the trustees.


One of the primary advantages of a living trust is that it offers you tax efficient management and control of assets during your life and after your death. The growth in your estate is “pegged” and the value will increase in the trust. A trust creates an entity that owns assets outside your personal estate, consequently excluding these assets from estate duty.

Taxes and costs of up to 35% on death can be saved, including:

  1.  Estate Duty (20% of Estate) as the trust will continue to exist after death.
  2.  Capital Gains Tax (16,4%) on growth assets.
  3.  Executor's Fees (at 3,99% of the gross estate).
    This is a particularly unnecessary and avoidable tax. Executor's fees are calculated on the gross value of an estate and deducted before any other expenses.
  4. Conveyancing fees on immovable property (as property ownership does not transfer to anyone after death).

Bank accounts and cash reserves will not be frozen during the winding up of the estate, which can take up to two years. A trust will ensure immediate access to capital and income after death.

Protection of minors. In South African law, a minor cannot be the registered owner of property, therefore the asset is liquidated and the proceeds invested in the Guardian Fund. Assets are also protected against spendthrift children.

Multi-ownership of assets. Some assets can not be divided, for example businesses and farms. By placing these types of assets in a trust, the heirs can be the beneficiaries of the income generated by the assets.

Confidentiality. Upon your death, your will becomes a public document. A trust does not form part of an estate and therefore the information of assets held in a trust remains confidential.