Should a Deceased Person’s Income Tax Return be filed?

Should a Deceased Person’s Income Tax Return be filed?

• 12 October 2023
• Tax Administration
• SARS

When a person dies, the Executor (an appointed person to attend to the administration of the estate of a deceased person) is required to submit a final income tax return for the deceased person, covering the period from the beginning of the tax year up to the date of death.

The tax return must include any taxable income received, as well as any property that is sold for purposes of the deemed disposal of assets for capital gains purposes at the date of death.

If the deceased person is not registered for income tax, has no taxable income, and does not own property to be sold for capital gains purposes at the date of death, the income tax return in the year of death is not required.

The return that must be completed for the deceased person is the same as the personal income tax return used for individuals which is an ITR12.

How to file a tax return on behalf of a deceased person?

An income tax return can be completed and submitted for a deceased person through any of the following channels: eFiling, SARS MobiApp, or at a SARS branch by first making an appointment.To learn more about tax compliance and obligation post-death, please visit  SARS's Estates website page.

Source: SARS

FAQs

1. Is an income tax return required for a deceased person in South Africa?

Yes. If the deceased person earned taxable income before their death, their final income tax return must still be filed with SARS to settle any outstanding tax obligations.

2. Who is responsible for filing a deceased person’s tax return?

The executor of the deceased estate is legally responsible for filing the return, ensuring that SARS receives all outstanding income tax submissions and payments.

3. What period does a deceased person’s final tax return cover?

The final return covers the period from the start of the tax year up to the date of death, including all taxable income earned during that time.

4. Does SARS automatically know when someone has died?

Yes. The Department of Home Affairs notifies SARS of a registered death, but the executor must still ensure that tax matters are finalised.

5. What documents are needed to file a deceased person’s tax return?

Key documents include the Letter of Executorship, death certificate, proof of income, bank statements, IRP5s, and supporting documentation for deductions or credits.

6. What happens if a deceased person was due a tax refund?

If SARS determines a refund is due, it will be paid into the estate’s bank account, managed by the executor, and then distributed according to the will or intestate laws.

7. Can penalties apply if a deceased person’s return is not filed?

Yes. Failure to submit a deceased person’s tax return can result in administrative penalties and delays in finalising the estate with SARS.

8. Does a deceased estate need to register for income tax separately?

Yes. A separate taxpayer profile for the deceased estate must be created with SARS so that income earned after death (such as rental or investment income) can be taxed correctly.

9. How long does SARS take to finalise a deceased person’s tax affairs?

The timeframe varies, but finalising a deceased estate’s tax matters can take several months, depending on the complexity of income, assets, and outstanding returns.

10. Should an executor get professional help with deceased estate taxes?

Yes. Executors are encouraged to consult a tax practitioner or accountant to ensure compliance, avoid penalties, and speed up the winding up of the estate.

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