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SARS AND TRUSTS: R16,000 A MONTH IN PENALTIES, OR A FEW SIMPLE STEPS

Writer: Compliance Hub Consulting
Compliance Hub Consulting
3 days ago
2 min read

If you are a trustee of a family trust, you may have seen this month's headlines about SARS penalties of up to R 16 000 a month. They are accurate. But for a trust that is properly looked after, they are also entirely avoidable.


What has changed?

Earlier this year SARS issued final demands to trusts with outstanding returns, then cancelled many of the resulting penalties in July 2026. That reprieve has ended. In October 2026 SARS began issuing new final demands, and trustees now have 21 business days from a demand to file before penalties apply.


The penalty is fixed by the trust's taxable income or assessed loss for the previous year:

The penalty repeats every month the return is outstanding, for up to 35 months. Unpaid penalties can be recovered from third parties, such as a trustee's employer.

Where trusts commonly get caught

  • The trust is dormant, so the trustees assume nothing needs to be filed. It does.

  • The trust was registered with the Master but never registered with SARS.

  • Trustees changed, but SARS and the Master still show the old trustees.

  • The trust was wound up at the Master, but never deregistered at SARS.

  • Nobody is checking eFiling or the post for final demands.


Why you do not need to worry

Trust compliance is not complicated. It is a short, predictable list of things that must happen every year, on time, with the paperwork to prove it. The 2026 trust filing season runs from 19 September 2026 to 22 January 2027, so there is still time to get every return in order.


Five steps to a compliant trust

  1. Check your SARS position. Confirm the trust is registered for income tax, look for any final demands, and make sure previously reversed penalties have actually been removed.

  2. Bring trustee records up to date. The trustees on your Letters of Authority must match what SARS holds.

  3. File every outstanding ITR12T return, including nil returns for dormant trusts, supported by financial statements and trustee resolutions.

  4. Keep the beneficial ownership register current and lodged with the Master.

  5. Put it on a calendar. Annual meeting, distribution resolutions, IT3(t) and ITR12T returns, every year, without fail.


If a penalty has already been raised, file the outstanding return first. That stops further penalties, and only then can a request for remission be lodged.

 

SOURCES




Lawvero (Pty) Ltd · Reg. 2026/679063/07 · 19 Mirzam Street, Midstream Ridge, Midstream, 1692


This article is general information and not tax or legal advice. Lawvero provides document preparation and administration services and does not provide legal advice.

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