Estate Duty in South Africa Explained: Rates, Exemptions & How to Plan

Estate duty is a tax levied by SARS on the estate of a deceased person. If your estate is worth more than R3.5 million, estate duty applies — and planning ahead can significantly reduce the amount SARS takes.

What Is Estate Duty?

Estate duty is governed by the Estate Duty Act 45 of 1955. It is a tax on the transfer of wealth at death — essentially, the government takes a percentage of your estate before it passes to your heirs.

Current Estate Duty Rates (2025)

Net Estate Value	Rate
R0 – R30 million	20%
Above R30 million	25%

But the rate is only applied to the dutiable estate — after deductions and abatements reduce the taxable amount.

The Primary Abatement: R3.5 Million

Every South African resident gets a primary abatement of R3.5 million. This means the first R3.5 million of your estate is completely exempt from estate duty.

If you're married, the unused portion of a deceased spouse's abatement can be claimed by the surviving spouse — effectively giving married couples a combined abatement of R7 million. This is called the "portable abatement" and was introduced in 2010.

Key Deductions That Reduce Your Dutiable Estate

1. Bequests to a surviving spouse

Assets left to a surviving South African-resident spouse are fully exempt from estate duty. This is the most powerful estate duty tool available — but it defers the tax rather than eliminating it (the spouse's estate will eventually be taxed).

2. Funeral and deathbed expenses

Reasonable funeral costs and medical expenses from the final illness are deductible.

3. Liabilities

All debts owed at death — mortgage bonds, personal loans, credit cards — are deducted from the gross estate before duty is calculated.

4. Bequests to public benefit organisations

Donations to approved charities and NPOs are fully deductible.

What Assets Are Included in Your Dutiable Estate?

• Property (fixed and movable) in South Africa
• Investments and savings accounts
• Retirement funds (partially — only if paid to non-dependants)
• Life insurance proceeds (unless policies are correctly structured)
• Business interests
• Cryptocurrency and digital assets
• Foreign assets (if you are a SA resident)

Life Insurance and Estate Duty

Life insurance proceeds are prima facie included in your dutiable estate — unless the policy is made payable to a named beneficiary who is not your estate. Policies payable directly to a spouse or children are excluded from estate duty. This is one of the most common and effective estate planning tools in South Africa.

Retirement Funds

Retirement fund benefits (pension, provident, retirement annuity) paid to financial dependants are excluded from estate duty. This makes naming dependants as beneficiaries on your retirement fund critically important — and separate from your will (the fund trustees have discretion over who receives the benefit).

A Simple Estate Duty Example

Assume you are single with a gross estate of R6 million:

• Gross estate: R6,000,000
• Less: Outstanding mortgage: R500,000
• Less: Primary abatement: R3,500,000
• Dutiable estate: R2,000,000
• Estate duty at 20%: R400,000

Use the urWill Estate Duty Calculator

urWill's built-in estate duty calculator lets you estimate your estate duty liability in minutes. Enter your assets and liabilities, and see exactly what your estate would owe SARS — along with planning opportunities to reduce it. It's free and built specifically for South African estates. Once you know your liability, create your will online and appoint a trusted executor — read our guide on choosing the right executor to minimise administration costs.