Since the relaxation of exchange control regulations in South Africa, a growing number of clients own assets abroad. This includes investment assets and fixed property. The question arises how these assets should be handled in your will. What happens with these assets after your death?
Three factors must be taken into account to determine whether foreign assets are covered by a South African will or whether it is necessary to set up a foreign will. These factors are:
- The country where these assets are held
Assets owned in e.g. England or New Zealand are covered by a South African will. Assets in Spain or Jersey require a foreign will in that country.
- The administrator of assets such as foreign investments
If the administration is handled by an administrator or entity that does not specifically require a foreign executor to be appointed, a South African will should suffice.
- The structures used to invest the foreign assets
Policy structures, companies et cetera are examples of structures in which foreign assets can be held. Each of these structures should be reviewed independently for this purpose.
Spending time to plan your estate properly is therefore essential if you own foreign assets. A South African will drafted in English may be sufficient. If your South African will is set in Afrikaans, it can slow down the liquidation process. The Afrikaans will will have to be translated and sealed before it can be sent to the overseas executor/agent; it is a time-consuming and expensive process. It is not self-evident that a foreign will and a foreign executor will be required during administration.
If a foreign will is necessary, there will be more than one will. It is important that these two documents correspond with each other so that one does not cause the revocation of the other. The legal requirements for setting up a will in other countries may differ from the requirements in South Africa. This may result in certain bequests in your South African will not recognised in a foreign country. It is crucial to choose a professional, licensed service provider abroad as executor or as agent for your executor under power of attorney or as trustee of your offshore trust. It is important that you have the support of an established, national South African institution such as a trust company that can assist you with the process.
It is therefore important that comprehensive planning is done to ensure that there will be no glitches during the administration.
