When the registered owner of immovable property dies, the property forms part of their deceased estate. Consequently, no dealings can occur until the relevant Master of the High Court of South Africa issues Letters of Executorship or Letters of Authority, appointing an Executor or Master's Representative to manage the winding-up of the deceased's estate.
For conveyancing purposes, this appointed representative signs the necessary transfer documents on behalf of the deceased estate. Below is a guide outlining the procedures and key considerations for transferring property either by inheritance or by sale.
Transfer by Inheritance (Will or Intestate Succession Act)
- Commencement of the Process: Once the deceased estate's administration reaches a certain stage – typically after the Liquidation and Distribution Account has been approved by the Master – the transfer process may begin.
- Transfer in Terms of a Valid Will: If the deceased had a valid Last Will and Testament, the property is transferred to the testamentary heirs named in the Will.
- Transfer under the Intestate Succession Act: Where there is no valid Will, the heirs are determined in accordance with the Intestate Succession Act. This Act sets out how to identify the rightful heirs in various scenarios, such as when the deceased is survived by a spouse (whether married in or out of community of property), descendants only, both, or neither.
- Required Documentation: For transfers based on a Will, the Conveyancer must lodge a Master's certified copy of the Will alongside a Conveyancer's certificate in terms of section 42(1) of the Administration of Estates Act, confirming that the Liquidation and Distribution Account has lain for inspection without objections at the relevant Master's Office.
In instances where there is no Will, a Master's certified copy of the Next-of-Kin affidavit must be lodged instead.
- Transfer Duty Considerations: In terms of the Transfer Duty Act, transfers of immovable property from a deceased estate to the testamentary or intestate heir are exempt from the payment of transfer duty.
Sale of Immovable Property from a Deceased Estate
- Master's Approval: The sale of property from a deceased estate is subject to the approval of the Master in terms of section 42(2) of the Administration of Estates Act.
- Consent of Heirs: All heirs, whether designated by a Will or determined under the Intestate Succession Act, must consent to the sale before the Master will approve it.
- Sale Agreement Preceding Death: If the deceased entered into a sale agreement prior to death but the transfer did not occur, the transfer of the property is temporarily delayed. The appointed Executor or Master's Representative then steps into the shoes of the deceased and signs the newly drafted transfer documents. Consequently, the sale agreement is executed by the representative, and the property is transferred from the deceased estate rather than from the deceased personally.
- Submission for Approval: Once the Conveyancer has collated all necessary documents – including the heirs' consents, the sale agreement, and the Power of Attorney to Pass Transfer (signed by the Executor or Master's Representative) – the Master will, in due course, affix their approval. Only then can the transfer to the purchaser proceed. It is essential that all parties understand that obtaining the Master's approval may take several weeks or even months.
- Transfer Duty implications: For the sale of property from a deceased estate where the purchase price exceeds R1,100,000.00, the purchaser is liable for the payment of transfer duty to SARS.
Transfers from deceased estates are not conventional transactions and require a high degree of precision and attention to detail.
Whether transferring by inheritance or via sale, adhering to the correct procedures and documentation is essential to ensure compliance with legal requirements.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
