With regards to a deceased estate, must a taxpayer have 2 tax entities on e-Filing? One for the deceased until date of death and a separate one for the Deceased Estate, or does one use the same taxpayer? If a taxpayer needs two, how does one go about it on e-Filing? Is a brand new taxpayer created? The deceased estate was registered at SARS, but they did not issue a new tax number. Please advise.
Important:
This answer is based on tax law year ending 28 February 2021.
Answer:
Income that accrued to date of death must be declared on behalf of the deceased person in the tax entity for the deceased person until date of death. Income that accrued after date of death must be declared on behalf of the deceased estate in the new tax entity to be registered after date of death. The registration of the new tax entity can be done at a SARS branch or on efiling under the organisation profile. See paragraph 7.2 ORGANISATION SETUP of the EXTERNAL GUIDE FOR TAX PRACTITIONERS ON EFILING . Paragraph 8 of The EXTERNAL GUIDE HOW TO COMPLETE THE REGISTRATION, AMENDMENTS AND VERIFICATION FORM (RAV01) ACTIVATE REGISTERED REPRESENTATIVE indicates that the executor of the deceased estate must activate the representative status to be able to request second registration of the deceased estate. Second Income Tax registration of the deceased estate can only be done if there is post death income and the registration is only applicable to taxpayers who passed away on or after 01 March 2016 (2017 tax year) under Income Tax Product. The executor or a representative of a deceased estate must register the deceased estate for the second tax reference number once the first tax reference number has been coded as “Deceased”. The executor must confirm the tax status of the reference number by clicking on “Income tax” under “My tax products. To register the deceased estate for the second tax reference number: • Open Income Tax container and select Normal as sub category and “Post Death Income” as Classification. • Confirm that the “Date of Liability” is set as 2017 or the tax year in which the Taxpayer received the post date of death income. • Once the second registration is processed and the entity has an existing “To-Date of Death” Estate record, the second registration will automatically be set with a status of “Deceased Estate”.