IT3(t) nil returns: when a trust reports

Establishing when a trust has nothing to report on IT3t

28 October 2026
Compliance
Dr Stiaan Klue

Source: TaxCafe, Carmen Westermeyer CA(SA), October 2026. Available on Webinar-on-Demand: TaxCafe with Carmen Westermeyer - October 2026

At a glance

Question	Governing distinction	Practical response
Is the trust within scope?	Reporting population and exclusions	Apply the notice to the particular trust
Was no cash paid?	Payment differs from vesting	Inspect resolutions and beneficiary accounts
Are amounts genuinely zero?	Zero financial values differ from no beneficiary data	Apply the current submission specification
Has the filing date passed?	2026 IT3(t) deadline was 30 September 2026	Resolve outstanding submissions promptly

“No distribution” is an unsafe starting point for deciding whether a trust has an IT3(t) obligation. It may mean that no cash left the bank account, that no amount vested, or simply that the accounts have not yet been finalised. Those are different facts with different consequences.

An IT3(t) third-party return requires a separate review of the trust’s reporting obligations and beneficiary information. Practitioners must establish whether amounts vested, whether the trust falls within the reporting population and how the current submission specification treats genuinely zero financial values.

Read the reporting obligation separately from the income tax return

The South African Revenue Service (SARS) reporting framework includes Notice 3631 in Government Gazette 48867 of 30 June 2023, issued under the Tax Administration Act 28 of 2011. Paragraph 2.15 identifies the relevant trusts; the table in paragraph 3 specifies the information and IT3(t) form. Resident trusts, and non-resident trusts required to submit an annual income-tax return, fall within the stated scope, subject to the specified collective-investment and employment-share-incentive exclusions. Notice 3631.

An IT3(t) submission does not replace the trust’s income-tax return (ITR12T). Nor does a zero tax liability mean that both returns should contain zeros throughout. The ITR12T addresses the trust’s tax affairs; the third-party return supplies information relevant to other persons and to reconciliation of the trust’s financial flows.

The file should therefore contain separate sign-offs for the trust return and the third-party submission. A general note reading “trust dormant” does not answer either enquiry. An excluded entity should retain the precise basis for exclusion rather than relying on the broad description used in its name.

Client conversation trigger: Review trusts marked “nil”, “dormant” or “no distributions” in the practice register and require a documented conclusion for each return type.

A vesting can exist without a cash payment

The income-tax treatment of trust income requires consideration of section 25B of the Income Tax Act 58 of 1962 and, where relevant, the attribution rules and capital-gains provisions. The reporting exercise must reflect the legal rights created during the year. A beneficiary loan-account credit may evidence an amount vested even though payment is deferred. A subsequent payment may instead settle an entitlement already reported in an earlier period.

Read the trust deed and the contemporaneous trustee resolutions against the ledger. Establish the character of each amount: income, a capital gain, capital, a loan advance or repayment. Avoid turning a single payment into a taxable distribution merely because it is paid to a beneficiary. Conversely, do not omit an entitlement because the bank balance was insufficient to pay it.

Illustrative example. Trustees validly vest R80 000 of current-year income in a beneficiary before year-end and credit the beneficiary’s account. Cash is paid in the following year. Assuming the vesting is effective and the relevant tax conditions are met, the lack of a year-end cash payment does not make the earlier reporting period a nil period. The later payment must be reconciled so that the same amount is not treated as a fresh vesting.

Client conversation trigger: Ask trustees with unpaid beneficiary balances to supply the resolutions creating those balances and identify the year in which each entitlement arose.

Use zero value reporting carefully

The practical recommendation is to complete the applicable zero-value reporting process for an in-scope trust with genuinely no reportable financial amounts, while preserving all demographic and other records required by the current specification. A zero-value submission should not be confused with a blank file or an unsupported declaration that no beneficiaries exist. Technical field requirements must be checked for the reporting year and submission channel. SARS: IT3 data submission specifications.

Document this as a compliance approach based on the notice, the applicable specification and the trust’s facts. It is not a universal statutory requirement for every trust to submit an identical “nil form”.

SARS published 30 September 2026 as the IT3(t) deadline for the 2026 year of assessment. That date has passed. An outstanding submission should be resolved now, and any resulting discrepancy in a beneficiary’s or trust’s return should be assessed independently. Filing one return does not silently correct another. SARS: 2026 trust filing announcement.

Client conversation trigger: Obtain acceptance receipts for the 2026 IT3(t) submissions and compare reported amounts with trustee resolutions, beneficiary schedules and the returns already filed.

Practitioner action checklist

#	Area	Issue	Clients affected	Action required	Timing
1	Scope	Notice exclusions	All trusts	Record the reporting conclusion	Annually
2	Vesting	Unpaid entitlements	Beneficiary balances	Trace resolutions to ledger	Before reporting
3	Zero values	Required data remains	In-scope nil trusts	Apply current specification	Promptly
4	Reconciliation	Cross-return differences	Trusts and beneficiaries	Check amounts and acceptance	After submission

Before signing off a nil position, retain the scope assessment, vesting review and submission outcome. Together, they explain why the trust’s reported financial values are zero.

Frequently asked questions

Does a trust need an IT3(t) if nothing was distributed?

No distribution is an unsafe starting point. It may mean no cash left the bank, no amount vested or the accounts are unfinalised, and those facts have different consequences.

Which trusts must submit IT3(t) returns?

Notice 3631 identifies the relevant trusts. Resident trusts, and non-resident trusts required to submit an annual income-tax return, fall within the stated scope, subject to its terms.

Does the IT3(t) replace the trust’s ITR12T?

No. The ITR12T addresses the trust’s tax affairs, while the IT3(t) third-party return supplies information relevant to other persons and the trust’s financial flows.

Build your expertise: to apply these principles in practice, explore The Tax Faculty’s Short Course in Taxation and Administration of Trusts.

About the author

Dr Stiaan Klue is Executive Dean and CEO of The Tax Faculty. He was the founding CEO of the South African Institute of Taxation (SAIT) and is the founding author of Silke on Tax Administration (LexisNexis).

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