Taxing of High-Net-Worth Individuals
Presenters : Cheryl Howard
Overview
The tax environment for High-Net-Worth Individuals (HWI)—defined as persons with gross assets exceeding R75m—undergoes a material shift toward enforcement-driven changes and base-broadening. Key highlights include:
- Dedicated SARS Unit: Launched in April 2021, the HNW Unit focuses on voluntary compliance and enhanced revenue collection.
- Intensified Scrutiny: SARS increasingly focuses on luxury assets (vehicles and properties), offshore holdings, and trust structures.
- Compliance Notices: A notice issued on 27 March 2026 signals stricter compliance regarding donations, inter-spousal transfers, and low-interest loans to trusts.
- Tax Burden: HWIs remain heavily taxed through Capital Gains Tax (CGT) at death (with top effective rates of 18%), estate duty (20%–25%), and donations tax.
- Risk Profile: Audit risks are materially higher than 5–10 years ago, with SARS actively testing declared income against lifestyle.
Video Content
The course provides a comprehensive look at the administrative and legislative landscape for 2026 and 2027. The syllabus covers:
- Risk Mitigation: Proactive management strategies to reduce the risk of intense scrutiny and lifestyle audits.
- The Lifestyle Audit: Detailed examination of how these audits are conducted.
- Income Taxes & Planning:
- Donations tax and inter-spousal donations
- Utilising retirement funding for tax and estate planning
- Inter Vivos Trusts:
- The impact of Section 7C
- The withdrawal of Practice Note 31 and the introduction of Section 11G
Competencies Developed
By participating in this video, attendees gain the ability to:
- Understand the HNW Unit: Gain insight into the specific focus and intensified scrutiny methods of the SARS HNW Unit.
- Navigate Compliance: Identify local and foreign compliance requirements necessary for wealthy taxpayers.
- Manage Audit Risk: Consider and identify proactive management measures to mitigate the risk of audits and investigations.