Article

Administration of Deceased Estates in South Africa: Complete Guide to the Process, Letter of Authority and Letter of Executorship

When a person dies in South Africa, their assets, debts and financial affairs do not simply pass to family members. A deceased estate must be formally reported and administered in accordance with South African law.

The administration of a deceased estate can be complicated, particularly where the deceased owned immovable property, had substantial debts, was married, had minor children, left a Will, or where family members disagree about the distribution of the estate.

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What is a deceased estate?

A deceased estate consists of everything a person owned and owed at the time of their death.

The estate may include:

  • Houses and other immovable property;
  • Money in bank accounts;
  • Motor vehicles;
  • Shares and investments;
  • Business interests;
  • Furniture and household goods;
  • Money owed to the deceased;
  • Certain insurance benefits; and
  • Other assets belonging to the deceased.

The estate may also have liabilities, including:

  • Home loans and bonds;
  • Personal loans;
  • Credit-card debts;
  • Municipal accounts;
  • SARS liabilities;
  • Medical expenses;
  • Other creditor claims; and
  • Expenses associated with administering the estate.
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What is a Letter of Executorship?

A Letter of Executorship is the formal authority issued by the Master of the High Court to an executor authorising that person to administer the deceased estate.

An executor should not simply begin dealing with the deceased’s assets without the necessary authority.

The Letter of Executorship is therefore an important document because it establishes the executor’s authority to act on behalf of the estate.

For estates exceeding the prescribed threshold, the full administration procedure applies and the Master generally issues a Letter of Executorship.

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What is a Letter of Authority?

A Letter of Authority is issued by the Master in certain smaller estates.

Under section 18(3) of the Administration of Estates Act 66 of 1965, the Master may dispense with the appointment of an executor and issue a Letter of Authority where the value of the estate does not exceed the prescribed threshold.

The person appointed under the Letter of Authority is generally referred to as the Master’s representative.The current threshold indicated by the Department of Justice is R250,000.

When is a Letter of Executorship issued?

Under the current Master’s guidance, where the estate exceeds R250,000, a Letter of Executorship is generally required and the estate is administered under the full procedure applicable to deceased estates.

A Letter of Executorship may also be relevant in other circumstances where the Master determines that an executor must be appointed.

The executor may be:

  • The person nominated in the Will;
  • A person nominated by the heirs where there is no Will; or
  • Another suitable person appointed by the Master.
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The Master appoints the executor or representative

After considering the documentation, the Master determines the appropriate form of administration.

For an estate requiring an executor, the Master appoints the executor and issues the Letter of Executorship.

For a qualifying smaller estate, the Master may issue a Letter of Authority.

This is a critical stage because the authorised representative can then formally commence the administration of the estate.

At Maphadzi Attorneys, we assist families, beneficiaries and executors with the efficient and proper administration of deceased estates in South Africa. Our services include reporting the estate to the Master of the High Court, obtaining Letters of Authority or Letters of Executorship, assisting with the identification and valuation of assets and liabilities, preparing and lodging the Liquidation and Distribution Account, attending to beneficiary and creditor matters, and assisting with the transfer and distribution of estate assets. Where disputes, delays or difficulties arise during the administration process, we can also provide legal advice and take appropriate steps to protect the interests of beneficiaries and ensure that the estate is properly finalised.

OUR CONTACT NUMBER: 0655512723