DEFINITIVE GUIDE · ESTATE ADMINISTRATION
Estate Duty in South Africa
Estate duty is a tax levied on the estate of every South African resident at death. The basic abatement of R3,500,000 under Section 4A(1) of the Estate Duty Act 45 of 1955 has been unchanged since 2010. The rate is 20% on the first R30,000,000 of dutiable value, and 25% above. This page covers every aspect of the calculation — deductions, spousal rollover, portable abatement, and the REV267 filing obligation.
R3,500,000
Basic abatement
s4A(1) — unchanged since 2010
R7,000,000
Combined spousal abatement
s4A(2)–(4) maximum
20%
Rate tier 1
Dutiable amount ≤ R30,000,000
25%
Rate tier 2
Dutiable amount > R30,000,000
12 months
REV267 deadline
From date of death — s10(1)
6% p.a.
Interest on unpaid duty
s10(1) Estate Duty Act
WHAT IS ESTATE DUTY
A tax on the estate — not on the heirs
Estate duty is the South African equivalent of what many countries call death tax, inheritance tax, or estate tax. It is governed by the Estate Duty Act 45 of 1955 and is levied on the estate of every person who was ordinarily resident in South Africa at the time of their death, regardless of where their assets are situated in the world. Non-residents are also subject to estate duty on property that is physically located in South Africa.
The critical distinction between estate duty and an inheritance tax is timing and burden. Estate duty is charged on the estate before distribution to heirs. The executor calculates and pays the duty from estate funds. Heirs receive their inheritance net of estate duty already settled. This is unlike an inheritance tax — which would be charged to each heir individually based on what they receive. South Africa has never had an inheritance tax in that form.
The practical consequence is significant for estate planning. A poorly structured estate may exhaust its liquid assets paying estate duty before heirs receive anything. An estate consisting primarily of a family home and a retirement annuity — both illiquid — can create a situation where the executor must either borrow funds, negotiate an instalment arrangement with SARS, or force the sale of the primary asset to settle a duty bill. Avoiding this outcome is the primary driver of estate planning in South Africa.
Property that passes to a surviving spouse is protected from estate duty in the first estate under the Section 4(q) deduction — one of the most important provisions in the Estate Duty Act. It means that in a typical married couple scenario, estate duty is deferred entirely until the death of the surviving spouse. At that point, the surviving spouse's estate potentially benefits from a combined abatement of up to R7,000,000 under the portable abatement provisions.
Estate duty should not be confused with the administration costs of an estate — executor fees, Master's fees, conveyancing costs, and SARS income tax obligations for the deceased. All of these are separate obligations that run concurrently with the estate duty calculation. The total cost of dying in South Africa can therefore be significantly higher than the estate duty figure alone suggests.
ESTATE DUTY RATE TABLE
Estate Duty Act 45/1955 · First Schedule
R0 – R3,500,000 (dutiable)
0%
Abatement applies (s4A(1))
R3,500,001 – R30,000,000
20%
Para 1(a)(i) — since 1 March 2018
Above R30,000,000
25%
Para 1(a)(ii) — since 1 March 2018
ABATEMENT STRUCTURE
Basic abatement (s4A(1))
R3,500,000
Surviving spouse max additional
R3,500,000
Combined max (married)
R7,000,000
Unchanged since
1 January 2010
KEY SECTION REFERENCES
s3Deemed property included in estate
s4Allowable deductions from gross value
s4(q)Spousal rollover — bequests to spouse
s4(h)PBO/State charitable bequests
s4A(1)R3,500,000 basic abatement
s4A(2)–(4)Portable abatement (surviving spouse)
s7REV267 filing obligation
s10(1)12-month deadline; 6% interest
THE GROSS ESTATE
What is included in the estate — and what Section 3 deems to be included
The gross estate for estate duty purposes is broader than simply what the deceased owned. Section 3 of the Estate Duty Act deems certain assets to be included even where the deceased did not own them outright at date of death.
Directly owned assets — always included
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All immovable property in South Africa (including holiday homes and investment properties)
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Movable property owned at date of death — vehicles, jewellery, artwork, furniture
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Bank accounts, unit trusts, listed shares, cryptocurrency holdings
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Business interests — shares in private companies, membership interest in a CC, partnership shares
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Trade debtors and amounts owing to the deceased
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Income accrued but not yet received at date of death
Deemed property under Section 3 — also included
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Proceeds of life insurance policies where the estate or executor is the named beneficiary (policies with a named living beneficiary pass outside the estate)
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Donations made within 5 years of death where the donor retained a right of enjoyment during their lifetime
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Property placed in a trust by the deceased where they retained control or a right to income — anti-avoidance provisions apply under s3(3)(d)
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Annuities payable to a surviving spouse that arise from property held by the deceased
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Property disposed of in terms of a donatio mortis causa (a gift made in contemplation of death)
Important: retirement fund proceeds generally pass outside the estate
In most cases, proceeds from retirement annuity funds, pension funds, and provident funds are paid to nominated beneficiaries and do not form part of the deceased estate for estate duty purposes. The fund trustees exercise a discretion under Section 37C of the Pension Funds Act 24 of 1956, and distributions are not included in the gross estate. However, where the fund distributes the proceeds to the estate itself (rather than to dependants or nominees), those proceeds are included. Estate planning around retirement fund beneficiary nominations is therefore a material consideration in minimising estate duty.
SECTION 4 DEDUCTIONS
The deductions that reduce the gross estate before the abatement is applied
Section 4 of the Estate Duty Act provides a list of allowable deductions from the gross estate value. These deductions are applied first, before the R3,500,000 abatement is subtracted. Getting every legitimate deduction onto the REV267 return is the executor's most important estate duty obligation.
s4(a)Outstanding liabilities of the deceased
All debts owed by the deceased at date of death are deductible — mortgage bonds, vehicle finance, credit card balances, personal loans, overdrafts, and any other documented liability. The debt must have existed at the date of death; post-death obligations (such as estate administration costs incurred after death) are handled separately. The deduction is limited to the actual market value of the encumbered asset in cases where the liability exceeds the asset value.
s4(b)Income tax liability outstanding at date of death
The deceased's personal income tax liability for the current year of assessment up to date of death, and any prior-year assessments outstanding, are deductible. The executor must submit a final income tax return for the deceased covering the period from the start of the tax year to the date of death. SARS will raise an income tax assessment; the resulting liability is a section 4(a) deduction.
s4(c)Funeral and burial costs
Reasonable funeral and burial costs are deductible. SARS does not prescribe a maximum figure, but costs must be reasonable for the circumstances of the deceased. Elaborate funeral arrangements that go significantly beyond what is reasonable for the estate's size may be queried at assessment. Keep all receipts — the deduction requires documentation on the REV267.
s4(d)Administration and liquidation costs
Costs directly related to the administration of the estate are deductible — executor remuneration (subject to the 3.5% statutory maximum), conveyancing fees, Master's fees, advertising costs, and professional fees such as accountant and attorney fees incurred in administering the estate. Costs incurred in selling assets to raise cash for estate duty payments are also deductible.
s4(h)Bequests to approved public benefit organisations or the State
Property bequeathed to an approved public benefit organisation (PBO) registered under Section 30 of the Income Tax Act, or to the State, is fully deductible. The PBO must be registered and approved — a bequest to an organisation that is not formally approved under Section 30 does not qualify for the deduction. This provision makes estate planning that includes charitable giving particularly tax-efficient.
s4(q)Property accruing to the surviving spouse
The full value of property that passes to the surviving spouse — whether by will, by intestate succession, or by operation of the Matrimonial Property Act — is deductible from the gross estate. This is the single most significant deduction available in most South African estates. It means that in a typical married couple's estate, all assets left to the surviving spouse are excluded from the dutiable amount, deferring estate duty entirely to the second death.
s4(k)Property previously subject to estate duty — 10-year rolling relief
Where the deceased inherited property that was subject to estate duty in the estate of a predeceased person within the past 10 years, a sliding scale reduction applies to avoid double taxation on the same asset in quick succession. The reduction ranges from 100% (if the property was inherited within 2 years) to 10% (if the property was inherited between 8 and 10 years ago). For inheritances older than 10 years, no relief applies.
THE SPOUSAL PROVISIONS
The Section 4(q) rollover and the portable abatement — the two most important estate planning tools in the Act
The Section 4(q) spousal rollover — deferral of duty
Section 4(q) of the Estate Duty Act provides that the full value of property accruing to the surviving spouse is deducted from the gross estate value before estate duty is calculated. The effect is a complete deferral of estate duty on those assets until the death of the surviving spouse.
The word "accruing" in Section 4(q) is deliberately broad. It covers property passing by will, by intestate succession, by marriage out of community of property (including the accrual share), and by operation of any applicable statute. It also covers the proceeds of insurance policies that pass to the surviving spouse as a named beneficiary outside the estate — provided those proceeds are then included in the surviving spouse's estate when they die.
A critical point frequently misunderstood: the Section 4(q) deduction reduces the gross estate value before the abatement is applied. It is not applied after the abatement. This means that where a surviving spouse receives a bequest that reduces the net estate below the abatement, the unused portion of the abatement is available as a portable abatement to the surviving spouse's estate.
The rollover is not available in respect of property passing to a life partner who is not a legally recognised spouse. A permanent life partner recognised under the Intestate Succession Act (since 3 April 2024) does inherit intestate, but the Section 4(q) deduction applies specifically to a "spouse" as defined, which raises complexity in life partnership structures not formalised through civil marriage or civil union.
The portable abatement — doubling up at the second death
Section 4A(2)–(4) of the Estate Duty Act introduced the portable abatement, allowing the surviving spouse to inherit the unused portion of the predeceased spouse's R3,500,000 basic abatement. The maximum combined abatement available to a surviving spouse is R7,000,000 — their own R3,500,000 plus up to R3,500,000 from any predeceased spouses.
The "used" portion of the predeceased spouse's abatement is the amount by which the predeceased spouse's net estate (after Section 4 deductions, but before the abatement) was reduced to zero by the abatement. If the predeceased spouse had a net dutiable estate of R1,200,000, only R1,200,000 of their R3,500,000 abatement was "used" — leaving R2,300,000 portable to the surviving spouse.
The executor of the predeceased spouse's estate must file the REV267 correctly for the portable abatement to be available. The surviving spouse (or their executor when they die) must obtain the assessment or a letter from SARS confirming the unused abatement amount from the first estate. This documentation is critical — without it, the executor of the second estate cannot claim the portable abatement.
PORTABLE ABATEMENT — THE CALCULATION
Spouse A dies with net estate R800,000 → abatement used: R800,000 → unused: R2,700,000 portable to Spouse B. Spouse B later dies with combined estate R6,000,000. Spouse B's abatement = R3,500,000 (own) + R2,700,000 (portable from A) = R6,200,000. Net estate R6,000,000 minus combined abatement R6,200,000 = R0 dutiable. Estate duty: R0.
THE CALCULATION
How estate duty is calculated — step by step, with five real scenarios
Gross estate
Market value of all assets including deemed property under s3
Less s4 deductions
Spousal rollover, PBO bequests, debts, funeral costs, admin costs
Net estate value
Step 1 minus Step 2
Less abatement
R3,500,000 (s4A(1)) + any portable abatement from predeceased spouse
Dutiable amount
Step 3 minus Step 4. If negative: R0 estate duty.
Apply rates
20% to R30M / 25% above R30M. File REV267 within 12 months.
Example 1 — Married couple, full spousal bequest, R0 estate duty
Estate: primary residence R4,500,000, investment portfolio R800,000, vehicle R180,000. Total gross: R5,480,000. The deceased leaves everything to the surviving spouse by will.
Section 4(q) deduction: R5,480,000 (entire estate to surviving spouse). Net estate after deductions: R0. Abatement applied: R0 (nothing left to deduct against). Dutiable amount: R0. Estate duty: R0.
Portable abatement to surviving spouse: R3,500,000 (full abatement unused).
Example 2 — Single person, R6,500,000 net estate, duty payable
Single person, never married. Gross estate R7,200,000. Section 4 deductions: outstanding mortgage R420,000 + funeral R35,000 + admin costs R210,000 = R665,000. Net estate: R6,535,000.
Abatement: R3,500,000. Dutiable amount: R3,035,000. Rate: 20%. Estate duty: R607,000.
Example 3 — Surviving spouse using portable abatement, R0 duty
Surviving spouse dies. Their own estate (including inherited assets): R6,800,000 net after all deductions. Their own abatement: R3,500,000. Portable abatement from predeceased spouse (who had used R500,000 of theirs): R3,000,000. Combined abatement: R6,500,000.
Dutiable amount: R6,800,000 − R6,500,000 = R300,000. Estate duty: R60,000.
Example 4 — Very large estate, 25% tier triggered
High-net-worth individual. Gross estate R38,000,000. Section 4 deductions R2,500,000. Net estate R35,500,000. No surviving spouse, no portable abatement. Abatement: R3,500,000. Dutiable amount: R32,000,000.
First R30,000,000 at 20% = R6,000,000. Remaining R2,000,000 at 25% = R500,000. Total estate duty: R6,500,000.
Example 5 — Illiquid estate, charitable bequest reduces duty
Estate consists primarily of a family farm (R8,200,000) and a retirement annuity (passing outside the estate). Gross estate R8,200,000. Mortgage on farm R1,400,000. Charitable bequest to a Section 30 PBO: R1,500,000. Funeral and admin costs R120,000. Total deductions: R3,020,000. Net estate: R5,180,000. Abatement R3,500,000. Dutiable amount: R1,680,000. Estate duty: R336,000.
Without the charitable bequest, duty would have been R636,000 — a saving of R300,000 directly attributable to the PBO bequest.
THE REV267 RETURN
The filing obligation — what must be filed, when, and what happens if it is late
Section 7 of the Estate Duty Act places the obligation to file an estate duty return (Form REV267) on the executor. The return must be submitted to SARS within 12 months of the date of death under Section 10(1). This is not the same deadline as the Liquidation and Distribution account under the Administration of Estates Act — that has its own 6-month timeline from Letters of Executorship, which is a shorter window.
The REV267 is a comprehensive document that requires the executor to list every asset in the estate at market value at date of death, every Section 4 deduction with supporting documentation, the abatement calculation, and the resulting estate duty liability. SARS reviews the return and issues an estate duty assessment. The assessment is the formal determination of what is owed.
Interest at 6% per annum applies to any unpaid estate duty after the assessment due date under Section 10(1). This is a statutory rate fixed in the Estate Duty Act and does not change with the repo rate. It is notably lower than the SARS late-tax interest rate of 10.25% that applies to income tax — reflecting the fact that estate duty is assessed on capital rather than on recurring income.
Where the estate cannot pay estate duty in full because assets are illiquid, the executor must engage SARS proactively. Options include an instalment payment arrangement, an application to defer payment against security, or in exceptional cases, a payment in kind arrangement. Waiting for SARS to raise penalties is the worst outcome — early engagement preserves the most options.
REV267 FILING TIMELINE
Date of death
All deadlines calculated from this date
Day 0
Letters of Executorship issued
Master must process application first
Weeks to months
Inventory (J243) filed
s27 Administration of Estates Act
6 months from Letters
L&D account filed
s35 — extensions on application
6 months from Letters
REV267 filed with SARS
s10(1) Estate Duty Act
12 months from death
Estate duty assessed
SARS issues formal assessment
After REV267 review
Interest begins accruing
6% p.a. — s10(1)
If duty unpaid after due date
COMMON EXECUTOR MISTAKES ON THE REV267
Applying the abatement before the Section 4 deductions — the correct order is deductions first, then abatement
Omitting the Section 4(q) spousal deduction because the asset passes informally rather than by formal will
Not claiming the full 3.5% executor remuneration as a Section 4 deduction
Missing the portable abatement entitlement because the first estate's REV267 was never filed
Treating retirement fund proceeds as estate assets when they passed directly to named beneficiaries
ESTATE PLANNING CONTEXT
How South Africans legitimately reduce estate duty — and where the anti-avoidance rules bite
Life insurance to fund estate duty
A life insurance policy owned by the deceased, where the estate is the beneficiary, is included in the gross estate under Section 3. But if the policy is owned by a trust or a third party, with the premium paid by the deceased, the proceeds may pass outside the estate entirely. Life insurance funded estate duty cover is a standard estate planning tool precisely because the policy proceeds can be structured to reach the executor without forming part of the dutiable estate.
Low — standard toolCharitable bequests under Section 4(h)
Every rand bequeathed to an approved PBO reduces the net estate before the abatement is applied, reducing estate duty at the marginal rate of 20% or 25%. A R1,000,000 bequest to an approved charity in a large estate saves R200,000 in estate duty — effectively transferring R800,000 to charity at a cost of only R800,000 to the estate. This only works where the PBO is formally registered and approved under Section 30 of the Income Tax Act — the executor must verify the registration.
Low — explicitly allowedRetirement fund nominations
Retirement fund proceeds that pass to dependants or nominees under the Section 37C Pension Funds Act discretion typically fall outside the deceased estate. This makes retirement fund balance the most estate-duty-efficient form of wealth transfer, provided nominations are correctly maintained. The fund's board of management — not the will — controls where these proceeds go. A will that directs retirement fund proceeds to specific heirs is legally ineffective; the Section 37C process governs.
Low — nomination-dependentInter vivos trusts — the anti-avoidance trap
A common historical strategy was to transfer assets into an inter vivos trust during lifetime to remove them from the estate. Section 3(3)(d) of the Estate Duty Act now includes the value of property transferred to a trust where the deceased retained any right to the income or use of that property. Additionally, any loan account from the deceased to the trust — where the deceased simply converted personal assets into a trust loan — forms part of the estate at full face value. Planning around trusts requires specialist advice.
Complex — anti-avoidance rules applyDonations during lifetime
Assets donated during lifetime leave the estate and are no longer included at death. However, donations tax of 20% applies to donations above R150,000 per year in aggregate. Cumulative donations above R30,000,000 attract 25% donations tax. A systematic annual donations programme — staying within or near the R150,000 exemption per year — can gradually reduce a large estate over time. Assets donated within 5 years of death where the donor retained enjoyment are brought back into the estate under Section 3.
Moderate — donations tax appliesPrimary residence — estate duty efficiency
A primary residence is included in the gross estate at market value. There is no primary residence estate duty exemption in South Africa, unlike some other jurisdictions. However, the primary residence CGT exclusion (R3,000,000 gain or loss) means that the CGT cost of including the property in the estate is limited. The primary residence is often the single largest estate asset — particularly for estates near the R3,500,000 abatement threshold — making accurate valuation at date of death critically important.
Included in full — no exemptionFREQUENTLY ASKED QUESTIONS
Estate duty questions answered precisely
What is the estate duty abatement in South Africa in 2026?
The basic estate duty abatement is R3,500,000 per deceased estate under Section 4A(1) of the Estate Duty Act 45 of 1955. This amount has been unchanged since 1 January 2010. It means that a deceased estate with a net dutiable value of R3,500,000 or less pays zero estate duty. Where the dutiable amount exceeds R3,500,000, estate duty of 20% applies on the excess up to R30,000,000, and 25% on any amount above R30,000,000.
Does the surviving spouse pay estate duty in South Africa?
Property bequeathed to a surviving spouse is deducted from the gross estate value under Section 4(q) of the Estate Duty Act before estate duty is calculated — effectively exempting it from the first estate. The surviving spouse's estate will eventually be subject to estate duty, but at that point the surviving spouse inherits the deceased's unused abatement under the portable abatement provision in Section 4A(2)–(4). The maximum combined abatement available to a surviving spouse is R7,000,000.
What is the estate duty rate in South Africa?
South African estate duty is charged at 20% on the dutiable amount up to R30,000,000, and at 25% on any dutiable amount above R30,000,000. These rates have applied since 1 March 2018 under the First Schedule of the Estate Duty Act 45 of 1955. The 25% tier applies only to very large estates — the gross estate would need to be well above R33,500,000 (to reach R30,000,000 dutiable after deductions and the abatement) to trigger the higher rate.
How is the estate duty return (REV267) filed?
The executor must file Form REV267 with SARS within 12 months of the date of death under Section 10(1) of the Estate Duty Act. The return lists all assets, Section 4 deductions, the abatement, and the resulting estate duty calculation. SARS issues an assessment after reviewing the return. Interest at 6% per annum applies on any unpaid balance after the due date.
What happens if the estate cannot pay estate duty?
If the estate is illiquid and cannot pay estate duty immediately — common where the primary asset is a farm, business, or residential property that cannot easily be sold — the executor should engage SARS before the REV267 deadline. Options include instalment arrangements, deferred payment against security, or in exceptional cases, payment in kind. Interest at 6% per annum continues to accrue on any unpaid balance. Early engagement produces the best outcome.
Is estate duty the same as inheritance tax in South Africa?
No. South Africa does not have an inheritance tax. Estate duty is charged on the estate before distribution — heirs receive their inheritance net of duty already paid. A true inheritance tax would be charged to each heir based on what they receive. In South Africa, heirs pay no income tax on inherited assets; the asset is simply received at its date-of-death value for CGT base-cost purposes.
What are the Section 4 deductions allowed against the gross estate?
The main Section 4 deductions are: property passing to the surviving spouse (s4(q)); bequests to approved PBOs or the State (s4(h)); funeral and burial costs; outstanding debts and liabilities of the deceased; estate administration and liquidation costs; and a sliding-scale reduction for property inherited within 10 years from a predeceased estate that also paid estate duty. All deductions must be documented in the REV267 return.
What is the portable abatement and how does it work?
Section 4A(2)–(4) allows a surviving spouse to inherit the unused portion of a predeceased spouse's R3,500,000 abatement. If the first spouse used only R1,000,000 of their abatement, the remaining R2,500,000 is portable to the surviving spouse's estate, giving the survivor a combined abatement of up to R6,500,000. The maximum combined abatement from two spouses is R7,000,000. The first estate's REV267 must be correctly filed and assessed for the portable abatement to be available.
CALCULATE ESTATE DUTY
Estate Duty Calculator
Full Section 4 deduction sequence, abatement application, and two-tier rate calculation with exact Rand figures.
Executor Fees Calculator
3.5% capital fee + 6% income fee + Master's fee. Total executor costs as a separate line from estate duty.
Estate Liquidity Checker
Can the estate meet estate duty plus all other obligations without forced asset sales? LIQUID / ILLIQUID / INSOLVENT.
Wandile Lokwe
FAIS Key Individual · CenturionAI (Pty) Ltd · Centurion, Gauteng
20 years in South African financial services. All estate duty figures are sourced from the Estate Duty Act 45 of 1955, SARS Budget 2026/27 Tax Pocket Guide, and the SAICA Estate Duty Guide (December 2025). The abatement, rates, and portable abatement provisions on this page have been stable since 2010 and 2018 respectively — but are reviewed after every February Budget.