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How do I add a second tax number for a deceased estate on eFiling?
How do I add a second tax number for a deceased estate on eFiling?
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Direct answer
A deceased estate may need a second income-tax number where taxable income accrues to the estate after the taxpayer's death. SARS's current deceased-estate guide says that, for deaths on or after 1 March 2016, the second registration is required if taxable income accrued to the estate. SARS also says that the deceased person's original tax number must first be registered and coded as deceased before the second registration can be completed.
The key distinction is between income and deductions up to the date of death and income and deductions that belong to the estate after death. Do not create a second registration simply because a death has been reported. Establish whether the estate has post-death taxable income and whether the executor has the authority and records to register the estate correctly.
What this means in practice
The deceased person and the deceased estate can be separate taxpayers for the relevant periods. SARS distinguishes a pre-date-of-death assessment from the post-date-of-death assessment. For post-death taxable income, such as income that accrues to the estate after death, the estate registration allows the estate's activity to be dealt with separately.
Before using eFiling, ensure the underlying estate case has been reported and the executor is correctly identified. SARS's deceased-estates resources specifically include help on adding a second tax number on eFiling. The exact menus and prompts can change, so use the current SARS resource or live eFiling guidance rather than a saved screenshot or old sequence.
Prepare a clean split of records. A bank deposit paid after death is not automatically post-death estate income. Consider what the payment represents, when it accrued and which taxpayer's records it belongs to. The registration decision should be supported by the estate accounting file, not driven merely by the date money was received.
Step-by-step
- Confirm the date of death, existing personal income-tax reference and the executor's appointment. Keep the death notice or certificate and Master-issued authority in the estate file.
- Identify income and deductions up to the date of death separately from amounts that accrued to the deceased estate after death. Record the source, period and supporting evidence for each material amount.
- Confirm that SARS has coded the original taxpayer's tax number as deceased. SARS says this must happen before the second registration.
- Determine whether the estate has post-death taxable income. Examples in SARS's guide include rental or interest income earned by the deceased estate after death, but each payment must be reviewed on its facts.
- Use the current eFiling process for the second registration. Work only in the authorised executor or tax-practitioner profile. Follow prompts that request estate particulars or supporting information.
- Record the second tax number, eFiling confirmation and the date of registration. Update the estate ledger so that future records clearly show whether they belong to the deceased person or the estate.
- Revisit the tax-return position. The separate registration is part of administration, not a completed return. Check the applicable return period, supporting documents and any correspondence from SARS.
Documents and records to keep
- Death notice or death certificate and executor authority.
- Evidence that SARS has coded the original taxpayer as deceased.
- Income and deduction schedules split at the date of death.
- Post-death bank, rental, investment and expense records.
- eFiling registration confirmation and correspondence.
Important limits and exceptions
The second registration requirement is linked to taxable income accruing to the estate. Avoid a blanket approach. A payment received by the executor can relate to a pre-death right, a capital receipt, a beneficiary matter or estate income. Its proper treatment can affect the registration and return position.
SARS's guide is not a substitute for the estate's facts. Complex estates may have business income, foreign investments, shares, trusts, property sales or capital gains. Keep the tax-number registration process separate from the calculation of those tax consequences.
When to get tailored advice
Seek tailored advice where the estate has trading income, property rentals, foreign income, capital gains, a business, an insolvent estate, unclear accrued income or more than one executor. Advice is also sensible if SARS has not coded the original taxpayer as deceased or if eFiling does not present the expected registration route.