How long does it take to administer an Estate
Warwick has selected Appleton Fiduciary Services to provide Wills and Estate Administration services to its client base. Established in 1992, Appleton is one of the country’s largest independent fiduciary srvices company in South Africa. In this edition of the Warwick Wealth Matters, we have asked Appleton MD, Lauren Hean to outline some of the timelines and costs involved in the Estate Administration process.
| The Estate Administration Timeline | ||
| Action | Shortest possible time (days) | Time if delays are experienced (days) |
| From death to reporting the death to the Master of the High Court and handing in the Will | 2 | 21 |
| Waiting for the Master to issue letters of executorship to the Executor | 2 | 90 |
| Placing the advertisement for debtors and creditors | 7 | 14 |
| Advertisement time period | 30 | 44 |
| Time to finalise drafting the account and lodging with the Master | 7 | 60 |
| Waiting for approval from the Master | 14 | 90 |
| Preparing to advertise the account | 7 | 14 |
| Advertisement period | 21 | 28 |
| Distribution of assets | 30 | 180 |
| Final requirements and final cash pay-out to residual heirs | 30 | 180 |
| Total | 150 | 721 |
THE COSTS OF ESTATE ADMINISTRATION
The Fiduciary Institute of Southern Africa (FISA) www.fisa.net.za has a number of excellent Consumer Education pieces posted on its website. The following is a summary of a piece designed to alert consumers to the costs associated with death.
In addition to the immense emotional cost of the loss of a loved one, together with the possible immediate loss of income to a spouse or partner, the costs of Estate administration need to be borne in mind and planned for. The quantum of administration costs is often determined by the complexity of the Estate, but every Estate above R250,000 in value has certain requirements and formalities that have to be met and thus, certain costs that are incurred and that have to be borne by the Estate. These include: funeral expenses, Master of the High Court fees, Executor’s remuneration (currently, the prescribed tariff is set at 3,5% of the gross value of the assets), costs of a bond of security of approximately 0,5% of the gross value of the Estate, mortgage bond cancellation and conveyancing costs, costs of transferring other assets such as shares and timeshares, maintenance assets within the Estate, tax fees and vehicle registration certificates.
Remember too that there may be a host of claims against the Estate, including those of SARS, rates and taxes, mortgage bonds, bank overdrafts and other sundry creditors. This may mean that while the Estate may be solvent in that its assets exceed its liabilities, there may be insufficient cash to pay the costs associated with the administration of the Estate. This situation creates what is termed a ‘cash shortfall’ in the Estate that needs to be met by for example, the heirs contributing cash into the Estate, or by the sale of assets within the estate such as property or motor vehicles. Thus, it is vitally important that you consider the cash requirements of the winding up of your Estate when conducting your Estate planning with your Warwick Wealth Specialist of Financial Advisor.
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