The winding up of an estate is an administrative process which is undertaken in conjunction with the appropriate Master’s office. The Master’s office is essentially a government department with oversight functions to make sure the relevant taxes and creditors are paid in terms of the law and the heirs are paid in terms of the wishes of the testator.
The normal time period for winding up estates is between six to fifteen months and there are 6 distinctive stages to winding up an estate:-
1. Gathering all the background preliminary documentation and lodging the estate with the appropriate Masters office;
2. After receiving the letters of executorship advertising the estate for the benefit of potential creditors;
3. Evaluating the creditor’s claims, closing bank accounts, collecting investments and paying the creditor’s including SARS;
4. Preparing the estate accounts (commonly referred to as the liquidation and distribution accounts) and submitting them to the Master for approval;
5. On approval by the Master advertising the accounts for public inspection;
6. After advertising, assuming no additional accounts, paying out the heirs and arranging transfer of property.
If an individual lay person is appointed executor in terms of a Will, the master’s office will generally not allow the nominated executor to act without the appointment of an “agent” to assist the nominated executor.
An agent is normally an attorney or accountant who has estate experience.
We have years of experience in winding up of estates and have acted as “agent” on a number of occasions.
Due to the increase of fraud we are finding that bigger organizations are becoming more stringent in the information they require and want professional safeguards before closing accounts and paying out policies etc. As a consequence, lay executors often find the winding up of an estate tremendously stressful and time consuming.
The advantage of using a smaller firm with estate work is that heirs often feel included in the process because of the personal link. Further, often monies have to be advanced to heirs during the process which is easier to arrange with a smaller firm as opposed to a lengthy bureaucratic process with large institutions, in particular the banks.
With average estates we are prepared to act as “executor” at the legislated rate of 3.5% of the asset value of the estate. With very large estates we are prepared to negotiate a lower rate than legislated.
Every person who has assets should have a valid and up to date Will. Whenever there are changed circumstances, or at least every 5 years, your Will should be revisited.
For most people a simple Will is adequate, but we do not recommend standardized / shop purchased Wills as the Will my not properly reflect your intentions and one could overlook a formality which could result in your Will being invalid.
The significance of an invalid Will is that often this only comes to light once you have passed on and not in a position to rectify the defect. This can have disastrous consequences for your intended heirs.
We regularly draft new or updated Wills for clients. Our fees are competitive. Our Wills are of a high standard and have been accepted by the Master in Estates already finalised.