Winding up an estate still
takes longer than before the pandemic - what you can do
News24 – 29 December 2022
The timelines for winding
up an estate have improved since the peak of the Covid-19 pandemic but are
still likely to take longer than before Covid, as pandemic backlogs and other
problems persist.A year was a good expectation for an estate where the deceased
left a sound will and the estate was dealt with by an experienced executor,
Angelique Visser, Fiduciary Institute of Southern Africa (FISA) National
Councillor, says.
During the pandemic,
however, timelines deteriorated, making it common for any estate to take two
years to wind up, FISA reported last year. Increased deaths during the
pandemic were responsible for much of the delays, but the offices of the Master
of the High Court (the Master’s Offices) also took much longer to issue the
letters that appoint executors, approve the estate accounts and authorise the
distribution of estate assets to the heirs.
Bank delays frustrate
estate professionals
Recently FISA has expressed
its frustration with delays caused by banks and banks have admitted they too
were slowed up by Covid and are still catching up.
To wind up an estate, the
executor of the estate needs information about, among other things, your
deceased family member’s bank accounts and investments. The accounts then need
to be closed and the balances or investments transferred into a bank account in
the estate’s name.The executor also needs the tax certificates for those
accounts in order to file the deceased’s tax return and the estate’s return.
Ian Brink, chairperson of
FISA, said banks are dragging their feet on these three tasks.He says banks
have different procedures which they sometimes change without consultation,
leading to confusion among bank staff, as well as much frustration for FISA
members trying to help families wind up estates.
Months to respond
Visser says practitioners
are now able to obtain a letter of executorship from the Master’s Office within
two to three weeks, but then battle for three to four months for a response
from some of the banks. She says she has approached the senior management of
several banks for assistance but there has been no improvement.
Aneesa Razack, chief
executive officer of FNB Fiduciary, says Covid-19 negatively affected the
industry’s processes for winding up deceased estates. In addition to the
increase in deaths, there has been an increase in fraud and administrative
hurdles that are frequently beyond the control of executors and/or banks, she
says.
Razack says banks are
working through the Banking Association of South Africa with the Chief Master's
Office to address the challenges and minimise the adverse impact on the
families of those who have died. FNB is also trying to shorten the time it
takes to wind up estates by increasing its capacity to help its clients and
improving the processing of smaller estates using digital platforms, she says.
Two weeks to close account
Graham Mcpherson, head of
Nedgroup Trust, says once the correct documents have been submitted, it takes
14 days to close an account and pay any money into the estate account.
Delays are primarily due to
outages on the Master’s Office portal that banks and estate practitioners use
and the need to get all the necessary documents from different parties,
Mcpherson says. All of this has been compounded by the large volumes of estates
currently experienced, he says.
During the peak of the
pandemic the Master’s Offices worked at 50% capacity and closed frequently when
staff became ill. The offices and the Department of Justice’s computer system
also suffered a ransomware attack in July 2021.
IT problems
The Master’s Offices are
now open but continue to be plagued by computer problems, the recent FISA
conference heard. Martin Mafojane, the Chief Master of the High Court, said the
Master's Offices do not have stable and reliable IT infrastructure resulting in
the offices’ portal frequently being unavailable to professionals dealing with
estates.
He said the offices fall
within the Department of Justice and Constitutional Development which has now
realised that rather than relying on contractors, it needs to recruit
competent, qualified and skilful people to provide the tools that the offices
require.
Confidence lost
Bongiwe Adonis, assistant
manager at the Cape Town Master of the High Court, said the Master’s Office
realised that practitioners and the public had lost confidence in it and that
it needs to modernise its systems.
Online registration of deceased
estates and trusts is one goal, and the aim is to have a user-friendly system
like the South African Revenue Service’s eFiling system, enabling registration
of an estate from anywhere in the world, she says. But we are not there yet, an
in the meantime, members of FISA, the Legal Practice Council and the South
African Institute of Chartered Accountants can use a self-help system available
at the Master’s Offices to register estates, she says.
The Master’s Offices have
committed to processing applications registered this way within 10 days, Adonis
says.
Estates that are not
registered on this self-help system – for example when documents are couriered
to the Master's Office have a 21-day turnaround time from the time, she said.
If the timeline is not met, the Master’s Office must explain the delay, she
says. Information is also being pulled from the Department of Home Affairs so
that dependants can be identified and fraudulent activities minimised, Adonis
says. With these and other initiatives, the Master’s Offices are headed towards
better and improved services by 2025, she says.
You can help
Both Standard Bank and
Nedbank said delays in dealing with deceased’s accounts are often a result of
families not knowing what documents must be submitted when and by whom. Both
banks provide step-by-step assistance helping you to understand the process and
requirements, they say.
Standard Bank’s Ross
Linstrom encourages families and executors to contact the bank as soon as
possible for assistance and guidance. If emergency access to the deceased’s
finances is required, this can be arranged if the necessary information is
provided to the bank, he says.
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