Inter-vivos trusts and trustees revisited

• Jurisdiction: South Africa
• Author: Peter Veldhuizen
• DOI: 10.10520/EJC174137
• Published date: 01 March 2013
• Date: 01 March 2013
• Pages: 26-29
• Published By: Siber Ink

26 © SIBER INK

Inter-vivos Trusts and

TrusteesRevisited

PETER VELDHUIZEN1

ABSTRACT

For many years now there has been a prolifiaration of inter vivos trusts, mainly

established by wealthy taxpayers to preserve their assets for future genera-

tions and to avoid estate duty. These trusts are usually administered by the

taxpayer and his or her friends, with little or no trust administration experi-

ence. As will be demonstrated in this article, there are many aspects that a

trustee must have knowledege of in order to properly administer a trust so as

to ensure compliance with the law.

OVERVIEW

Trusts have been utilised for many years in the practice of asset protection,

insolvency remoteness, tax savings and estate planning. While these are all

laudable goals, it is the administration and the govenance of trusts that has

not always met muster, and this article revisits some of the major concepts

and reviews recent court decisions that may affect the manner in which

trustees consider their approach to administering the assets of others.

LEGISLATION

Trustees would be wise to consider not only the Trust Property Control

Act2 but also the wealth of common law on trusts, the recent decided cases

and the further legislation which includes inter alia the:

• Matrimonial Property Act3;

• Insolvency Act4;

• Tax Administration Act5;

• Administration of Estates Act6;

• Estate Duty Act7; and

• Divorce Act8.

1

Partner, Gillan & Veldhuizen Inc.

2

Trust Property Control Act 57 of 1988.

3

Matrimonial Property Act 88 of 1984.

4

Insolvency Act 24 of 1936.

5

Tax Administration Act 28 of 2011.

6

Administration of Estates Act 66 of 1965.

7

Estate Duty Act 45 of 1955.

8

Divorce Act 70 of 1979.