THE LIVING WILL

Most people are familiar with a will or testament and understand the importance of having this legal declaration drafted, by which the testator nominates an executor to manage his or her estate and provide for the distribution of his or her property to beneficiaries when he or she dies.

But how many people have considered drafting a living will?

A living will does not deal with assets, heirs and beneficiaries, but with the philosophy of death and dying, and should be considered carefully and drafted by a professional.

A living will is a legal document expressing a person’s wishes regarding life-prolonging medical treatment when that person can no longer voice his or her wishes. It is also referred to as an advance medical directive.

A typical clause in a living will would read as follows:

If the time comes when I can no longer take part in decisions for my own future, let this declaration stand as my directive.

If I suffer from physical illness or impairment expected to cause me severe distress, rendering me incapable of rational existence, from which there is no reasonable prospect of recovery, I withhold my consent to be kept alive by artificial means and do not give my consent to any form of tube-feeding when I am dying; and I request that I receive whatever quantity of drugs and intravenous fluids as may be required to keep me comfortable and free from pain even if the moment of death is hastened. I withhold my consent to any attempt at resuscitation, should my heart and breathing stop and my prognosis is hopeless.

The living will tells the doctor and family that the patient does not consent to being kept alive artificially. It speaks for the patient at a time when the patient may be unable to communicate.

South African law and most religions accepts the validity of the living will, but none of the main religions accept euthanasia.

Euthanasia is against the law. Sean Davison, the respected UWC professor who helped his 85-year-old terminally ill mother, Patricia Ferguson, die in New Zealand by preparing a lethal dose of morphine, was arrested in New Zealand in September 2010 on an attempted murder charge.

It is important to have a properly drafted, legal living will to avoid far reaching and traumatic consequences for the loved ones that stay behind.

Many lawyers who practice in the area of estate planning include a living will and a health care power of attorney in their package of estate planning documents.

The advantages of a living will

  1. The directives respect the patient’s human rights, and in particular his or her right to reject medical treatment.
  2. It encourages full discussion about end-of-life decisions.
  3. It also means that the medical staff and caregivers are aware of the patient’s wishes, and knowing what the patient wants means that doctors are more likely to give appropriate treatment.
  4. It will avoid the situation where the patient’s family and friends have to take the difficult decisions.

Disadvantages of a living will

  1. Drafting this document can be very depressing.
  2. The person may still be healthy and not in a position to actually imagine that he or she could ever be in the position where they would voluntarily give up living.
  3. When the time comes to act on the living will the patient might have changed his or her mind and it is then often difficult to amend the document.

Important points to consider 

  1. The living will should not be incorporated or attached to the last will and testament, which is only acted upon after death.
  2. A living will does not become effective unless the patient becomes incapacitated; until then the patient will be able to choose appropriate treatment.
  3. A certificate by the patient’s doctor and another independent doctor certifying that the patient is either suffering from a terminal illness or permanently unconscious, is required before the living will becomes effective. In the case of a heart attack, the living will does not take effect. A living will is only executed when ultimate recovery is hopeless.
  4. You have to notify your doctor and family of your living will and preferably have copies of the document available for the doctor, hospital and family.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice.

Transfer of a property: Is VAT or transfer duty payable?

A purchaser is responsible for payment of transfer cost when acquiring an immovable property, but it should further be established if the transaction is subject to the payment of VAT or transfer duty to SARS.

When an immovable property is transferred, either VAT or transfer duty is payable. To determine whether VAT or transfer duty is payable one should look at the status of the seller and the type of transaction.

VAT

If the seller is registered for VAT (Vendor) and he sells the property in the course of his business, VAT will be payable to SARS. A vendor is a person who runs a business and whose total taxable earnings per year exceed R1 000 000. He will then have to be registered for VAT. A further stipulation is that the property that is being sold must be related to his business from which he derives an income.

The Offer to Purchase should stipulate whether the purchase price includes or excludes VAT. If the Offer to Purchase makes no mention of the payment of VAT and the seller is a VAT vendor, it is then deemed that VAT is included and the seller will have to pay 14% of the purchase price to SARS. It is the seller's responsibility to pay the VAT to SARS, except if the contract stipulates otherwise.

When a seller is not registered for VAT, but the purchaser is a registered VAT vendor, the purchaser will still pay transfer duty but can claim the transfer duty back from SARS after registration of the property.

Transfer duty

When the seller is not a registered VAT vendor it is almost certain that transfer duty will be payable on the transaction. A purchaser is responsible for payment of the transfer duty. Transfer duty is currently payable on the following scale:

  1. The first R750 000 of the value of the property is exempted from transfer duty.
  2. Thereafter transfer duty is levied at 3% of the value of the property between R750 000 and R1 250 000.
  3. Where the value of the property is from R1 250 001 up to R1 750 000, transfer duty will be R15 000 plus 6% on the value of the property above R1 250 000.
  4. If the value of the property falls between R1 750 001 and R2 250 000, transfer duty will be R45 000 plus 8% of the value of the property above R1750 000.
  5. On a property with a value of R2 250 001 and above transfer duty is R85 000 plus 11% on the value of the property above R2 250 000.

Transfer duty payable by an individual or a legal entity (trust, company or close corporation) is currently charged at the same rate.

Transfer duty is levied on the reasonable value of the property, which will normally be the purchase price, but should the market value be higher than the purchase price, transfer duty will be payable on the highest amount. Transfer duty is payable within six months from the date that the Offer to Purchase was signed.

In instances where a party obtains a property as an inheritance or as the beneficiary of a divorce settlement, the transaction will be exempted from payment of transfer duty.

Where shares in a company or a member's interest in a close corporation or rights in a trust are transferred, the transaction will be subject to payment of transfer duty if the legal entity is the owner of a residential property.

Zero-rated transactions

This means that VAT will be payable on the transaction but at a zero rate. If both the seller and the purchaser are registered for VAT and the property is sold as a going concern, VAT will be charged at a zero rate, for instance when a farmer sells his farm as well as the cattle and the implements.

Exemption

Transfer duty, and not VAT, will be payable when a seller who is registered for VAT sells a property that was leased for residential purposes.

It is thus important for a purchaser to establish the status of the seller when buying a property. The seller who is registered for VAT should carefully peruse the purchase price clause in a contract before signing, to establish if VAT is included or excluded.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice.

Wat gebeur as ek sterf sonder ‘n geldige testament?

Prokureurs lê dikwels klem op die optrek en gereelde hersiening van ‘n testament om die bemaking van jou besittings na jou dood te vergemaklik. Daar is egter steeds baie mense wat nie hierop ag slaan nie. Die probleem is egter dat, indien ‘n persoon te sterwe kom sonder om ‘n geldige testament na te laat, m.a.w. intestaat, sal sy/haar boedel in terme van die bepalings van die Wet op Intestate Erfopvolging Wet 81 van 1987, namens hom/haar toegeken en verdeel word.

Hieronder is ‘n basiese voorbeeld van watter uitwerking ‘n intestate sterfte op die verdeling van ‘n boedel sal hê. Indien die samestelling van die belanghebbende partye van die oorledene egter meer gekompliseerd raak, sal die verdeling van die boedel in terme van die Wet op Intestate Erfopvolging inderdaad ook meer ingewikkeld wees.

Kom ons veronderstel persoon A kom te sterwe met ‘n boedelwaarde van R1.8 miljoen en hy word oorleef deur ‘n vrou (B) en 2 kinders. Een van die kinders is meerderjarig en die ander minderjarig.

Scenario 1:

A en B is buite gemeenskap van goedere getroud.

B erf R125 000 of ‘n kindsdeel, wat ookal die grootste.

‘n Kindsdeel word bereken deur die totale waarde van die boedel deur die gade en aantal kinders te verdeel, m.a.w. R1.8 miljoen/3 = R600 000.

Die gade en kinders erf dus R600 000 elk.

Die minderjarige kind se erfenis sal aan die Meester se Voogdyfonds oorbetaal moet word, aangesien daar nie ‘n testament is wat bepaal dat ‘n minderjarige erfgenaam se erfenis bv. in ‘n Testamentêre Trust geplaas moet word om namens die minderjarige geadministreer te word totdat hy/sy meerderjarige ouderdom of ‘n ander gespesifiseerde ouderdom bereik het nie.

Scenario 2:

A en B is binne gemeenskap van goedere getroud.

B erf 50% van die boedel weens die huwelik binne gemeenskap van goedere.

B erf dan ook R125 000 of ‘n kindsdeel, wat ookal die grootste, ten opsigte van die ander helfte van die boedel.

‘n Kindsdeel word bereken deur die helfte van die totale waarde van die boedel deur die gade en aantal kinders te verdeel, m.a.w. R900 000/3 = R300 000.

Die gade erf dus R1.2 miljoen en die kinders R300 000 elk.

Die minderjarige kind se erfenis sal weereens aan die Meester se Voogdyfonds oorbetaal moet word, aangesien daar nie ‘n testament is wat bepaal dat ‘n minderjarige erfgenaam se erfenis bv. in ‘n Testamentêre Trust geplaas moet word om namens die minderjarige geadministreer te word totdat hy/sy meerderjarige ouderdom of ‘n ander gespesifiseerde ouderdom bereik het nie. Dit is dus baie duidelik dat Intestate vererwing ‘n onpraktiese verdeling, en in baie gevalle selfs ‘n moeilik uitvoerbare verdeling tot gevolg kan hê.

Die feit dat die minderjarige erfgenaam se erfenis aan die Meester se Voogdyfonds betaalbaar is, kan die gade in ‘n posisie plaas waar sy planne moet beraam om die bedrag wat ten behoewe van die minderjarige erfgenaam aan die Meester se Voogdyfonds betaalbaar is, te finansier of dat ‘n Verband ten gunste van die Meester se Voogdyfonds teen ‘n onroerende eiendom geregistreer moet word.

In die geval van ‘n sterfte sonder ‘n geldige testament is daar natuurlik ook nie enige persoon of instansie benoem om die gade by te staan met die administrasie van die boedel nie. Laasgenoemde behoort normaalweg nie ‘n struikelblok te wees nie, maar die gade behoort deeglik te besin oor die persoon of instansie wat haar met die administrasie van die boedel sal bystaan. Sy behoort ook die Eksekuteursvergoeding met die betrokke persoon en instansie te onderhandel voordat die administrasie van die boedel ‘n aanvang neem.

Hierdie is ‘n algemene inligtingstuk en moet gevolglik nie as regs- of ander professionele advies benut word nie. Geen aanspreeklikheid kan aanvaar word vir enige foute of weglatings of enige skade of verlies wat volg uit die gebruik van enige inligting hierin vervat nie. Kontak altyd u regsadviseur vir spesifieke en toegepaste advies.

DIE IMPAK VAN DIE NUWE BGSEB-KODES VIR GOEIE PRAKTYK OP JOU ONDERNEMING

Die samestelling en verifiëring van ‘n telkaart van ‘n entiteit in terme van die Wet op Breedgebaseerde Swart Ekonomiese Bemagtiging (BGSEB) word uitgevoer volgens die Kodes vir Goeie Praktyk (die Kodes) wat deur die Departement van Handel en Nywerheid (dti) uitgereik is. Die Kodes is gewysig en die nuwe Kodes is op Vrydag 11 Oktober 2013 in die Gazette gepubliseer. Hierdie verandering sal ‘n beduidende impak hê op die BGSEB-strategie van ondernemings, en daar sal deeglik besin moet word oor aanpassings van hierdie aspek.

Belangrike veranderings van die vorige Kodes sluit in:

  1. Die sewe elemente op die telkaart is tot vyf elemente gereduseer en die belading van elke element is soos volg aangepas:
  • l Eienaarskap (25 punte belading)
  • l Bestuursbeheer (15 punte belading)
  • l Vaardigheidsontwikkeling (20 punte belading)
  • l Ondernemings- en Verskaffersontwikkeling (40 punte belading)
  • l Sosio-Ekonomiese Ontwikkeling (5 punte belading)
  1. Die totale aantal punte sal nou 105 wees in plaas van die vorige 100.
  2. Die elemente Eienaarskap, Vaardigheidsontwikkeling en Ondernemings- en Verskaffersontwikkeling is nou gekategoriseer as prioriteitselemente, wat beteken dat sekere minimum vereistes van toepassing op hierdie elemente is. Daar word van groot ondernemings verwag om aan al die prioriteitselemente te voldoen, terwyl Kwalifiserende Klein Ondernemings (KKO’s) die keuse het om aan Eienaarskap en een van die oorblywende prioriteitselemente te voldoen.
  3. Indien daar nie aan die minimum vereistes wat aan die prioriteitselemente gestel word, voldoen word nie, sal die werklike vlak wat behaal word, met een vlak verlaag word.
  4. Die beperkings vir Vrygestelde Mikro-ondernemings (VMO’s) is aangepas vir ondernemings met ‘n jaarlike omset van tussen R0 en R10 miljoen (tensy ‘n sektorhandves van toepassing is). VMO’s sal steeds as vlak vier-bydraers beskou word.
  5. KKO-beperkings is aangepas vir ondernemings met ‘n jaarlikse omset van tussen R10 miljoen en R50 miljoen (tensy ‘n sektorhandves van toepassing is).
  6. VMO’s en KKO’s met swart eienaarskap van meer as 51% sal outomaties as vlak twee-bydraers kwalifiseer.
  7. VMO’s en KKO’s met swart eienaarskap van 100% sal outomaties as vlak een-bydraers kwalifiseer.
  8. Nuwe ondernemings sal steeds as VMO’s gemeet word tydens die eerste jaar na die vorming van die onderneming.

Daar sal 'n tydperk van twaalf maande wees vanaf 11 Oktober 2013 tot 10 Oktober 2014 waartydens ondernemings die keuse het om hul telkaarte saamgestel en geverifieer te kry onder óf die ou Kodes óf die nuwe Kodes. Die doel hiervan is om aan ondernemings die geleentheid te gee om hul BGSEB-strategie te implementeer en in lyn te bring met die nuwe Kodes. Sektorhandveste moet ook in lyn met die nuwe Kodes gebring word, maar dit is onduidelik of dit moontlik sal wees of selfs vereis word om dit binne hierdie twaalf-maande tydperk te doen.

Dit is uiters noodsaaklik om die advies van kenners in te win wanneer die onderneming se BGSEB-strategie aangepas word, ten einde duur foute te voorkom en die maksimum voordeel vir die onderneming te verseker, maar terselfdertyd behoorlik aan die vereistes van die relevante BGSEB-wetgewing te voldoen. Ondernemings wat byvoorbeeld voorheen op ‘n jaarlikse Sosio-ekonomiese Ontwikkelingstoelaag staatgemaak het om ‘n vereiste BGSEB-vlak te verkry, sal hierdie bedrag nou aansienlik moet aanpas.

Slegs gekwalifiseerde verifikasie-agente wat onder IRBA of SANAS geakkrediteer is, mag onafhanklike verifiërings uitvoer en die toepaslike sertifikaat uitreik.

Hierdie is ‘n algemene inligtingstuk en moet gevolglik nie as regs- of ander professionele advies benut word nie. Geen aanspreeklikheid kan aanvaar word vir enige foute of weglatings of enige skade of verlies wat volg uit die gebruik van enige inligting hierin vervat nie. Kontak altyd u regsadviseur vir spesifieke en toegepaste advies.