Can the independent trustee still provide services for free? - 7 February 2024

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Traditionally, accountants, attorneys, and financial advisors agreed to act as independent trustees for their clients’ trusts. Often they have provided the service for ‘free’. The general view was that they could not dare start charging for these services, as clients were so price-sensitive that they would take their entire business away from them and move it to someone else. However, there is a saying “nothing in life is for free”.

Do trustees receive the service they require? - 31 January 2024

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2023 has been a roller-coaster year with a tremendous amount of changes introduced; also changes in legislation affecting boards of trustees – often lay-person trustees. We should all take a deep breath, take stock of what we have, and (in the beginning of the year) proactively plan for the year ahead. Boards of trustees require 4 types of services. The first is statutory services to trusts, such as trust registrations, trust deed amendments, trustee changes, and the like.

A roller-coaster year for trustees - 7 December 2023

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What a roller-coaster year since the introduction of the Financial Action Task Force (FATF) measures late last year! The FATF final report, published in October 2021, scored 40 technical areas/legislation adequacy items (of which we were found to be fully compliant in only 3 of the 40, compliant or largely compliant in 20 of the 40, and partially compliant/non-compliant in 20 areas) and 11 areas of efficiency of implementing legislation (of which we were found to be critically weak on all items).

The years in review and ahead for trusts - 29 November 2023

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Although many are of the view that South Africa introduced more stringent measures for trusts and companies in the past year, out of free will, the opposite is actually true. Worldwide, countries started implementing Beneficial Ownership Transparency (BOT) measures. According to a World Bank study, 70% of a selection of large corruption cases involved complex ownership structures designed to conceal the identity of individuals, of which 15% involved trusts. Internationally it was found that trusts’ beneficial owners are often more challenging to identify compared to companies.

Is a once-off Beneficial Ownership Register sufficient? 9 November 2023

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After government promulgated onerous amendments to the Trust Property Control Act (TPCA) on 22 December 2022 (which were gazetted on 29 December 2022) and issued Regulations for its implementation on 31 March 2023, effective from 1 April 2023, trustees (often laypersons) are scrambling to comply with these new requirements.

Trusts and greylisting; when do trustees have to comply? 1 November 2023

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After South Africa’s greylisting in February 2023 by the Financial Action Task Force (FATF), and the introduction of more stringent measures for trusts by the South African Revenue Service (SARS), the extent of the lack of South African trust compliance became apparent. Trustees, trust service providers, accountants, and tax practitioners are struggling to meet all the new requirements and often they have to catch up with historical non-compliance first.

The trust accountant/advisor cannot look the other way 11 October 2023

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Professional accountants, whether they act as accountants, advisors and/or trustees of trusts, play important roles in the renewed focus on trusts, including a responsibility to report on non-compliance with laws and regulations that deal with matters such as fraud, corruption and bribery, money laundering, tax payments, financial products and services, environmental protection, and public health and safety.

Which beneficiaries to include as “Beneficial Owners” 4 October 2023

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There seems to be huge confusion and different interpretations of which types of trust beneficiaries to include as “beneficial owners” after new measures were hastily introduced in an attempt to avoid greylisting and to meet the Financial Action Task Force’s (FATF’s) requirements.