The R3.5m estate-duty myth - and what business owners actually pay
Many SA business owners assume they're 'under the threshold'. The truth, once a private business sits inside the estate, is usually very different.
Estate duty is calculated on the dutiable amount of your estate at death - currently at 20% on the first R30 million, and 25% above that. Yes, there's a R3.5 million abatement. And yes, assets passing to a surviving spouse are deductible. But the moment you add the market value of a privately-held business, intellectual property, and policy proceeds that haven't been correctly structured, the number climbs quickly.
The real risk is liquidity. Estate duty is payable in cash, within months. If the bulk of your estate is locked up in a business that produces income but can't easily be sold, your executor has limited options.
Solving this is structural work, not a product purchase. Done properly, the business stays in the family, the estate has the liquidity it needs, and the family inherits stewardship - not stress.