Real Estate Investor July 2021 July 2021 | Page 6

Direct your property investment question to editorial @ reimag . co . za , go to our Facebook page or participate in our regular webinars to ask your questions

Q

What are the advantages and disadvantages of holding assets in trusts ?

Some of the tax advantages enjoyed by A trusts in the past no longer apply , but it can still be beneficial to hold assets in a trust . These are the key advantages :

1

Asset protection – a trust is the only entity that benefits from total asset protection , thus ensuring it stays out of the clutches of creditors .

2

Estate planning and continuity – a trust survives the life of an individual ( donor / trustee / beneficiary ) and can span multiple generations . Because assets in a trust no longer fall into one ' s personal estate , they are not subject to estate duty .

3

Saving of executor ’ s fees – trusts can largely save high estate executor fees ( 3.5 % of the gross value of the estate excluding VAT plus 6 % of the interest collected after the deceased ’ s death ).

4

SIMON DIPPENAAR SDLaw
Confidentiality – a trust deed is a confidential document , as opposed to documents like wills and records of deceased estates , which are public documents and therefore open for inspection .

5

Control over assets – a donor can ensure a measure of control over their assets by appointing competent professionals ( the trustees ) to manage and maintain the assets in accordance with the donor ’ s directives .
4 JULY 2021 SA Real Estate Investor Magazine