Important offshore probate warning

Offshore Probate* relates to foreign investments that have to be wound up separately from a South African estate on death. This results in a costly procedure in that specific legal requirements exist in various foreign jurisdictions. This undoubtedly adds major delays and costs in winding up a South African resident's deceased estate. From our experience the above can cost as much as £1000!

When winding up the Estate of a South African Resident who has held an offshore investment:

1. The South African Executor (and where appropriate, the foreign Executor) has to obtain a bound certified copy of the Last Will and Testament from the Master of the High Court or Supreme Court where the assets are held.
2. An attorney in that foreign jurisdiction must be appointed as an Agent of the South African Executor.
3. The foreign attorney must then obtain a Writ of Probate in that jurisdiction's courts and more importantly the High Court or Supreme Court in the foreign jurisdiction where the assets are held.
4. The investment can only then be realised, or transferred to the heirs.

The fact that a foreign investment fund is registered with the Financial Services Board (FSB) does not mean that offshore probate will not apply. Most FSB approved funds require offshore probate on the death of the investor. The only case where offshore investments will not be subject to offshore probate is where the investment is made via a South African entity which has permission to investment offshore acting as a nominee and has permission to hold foreign assets.

Further to this, when it comes to calculating estate duty tax (death duties), all your assets - both local and foreign - are included in the calculation. At present, estate duty is payable at 20% of your net dutiable estate in excess of R3.5 million. South Africa has double tax treaties with many other countries to ensure that a local resident does not end up paying double duties both in South Africa and in the foreign country. Silke Financial Services has the skill and legal expertise to ensure the smooth running of your affairs, including legally avoiding offshore probate.

*Note: The word "probate" is a term used to describe the official copy of a Will with a certificate from the Master of the High Court duly certifying its originality.