South Africa requires enhancements to trust beneficial ownership information
The South African Revenue Service (SARS) announced, on 15 September 2023, new rules for information on the beneficial owners of trusts, including the type of documents that must be submitted. SARS’ aim is to record all beneficial owners of registered trusts to comply with the Financial Action Task Force (FATF) requirements.
In February, the FATF placed South Africa on its ‘grey list’, classifying the country as a jurisdiction lacking effective anti-money laundering (AML) and counter-terrorism financing (CTF) systems. Inadequate record-keeping and beneficial ownership information were identified as factors contributing to South Africa’s grey listing.
As of 1 April, trustees of South African trusts must collect and report up-to-date information on the beneficial ownership of trusts under s.11A of the Trust Property Control Act, as amended last December by section 6 General Laws Amendment Act 2022.
SARS has now announced that certain information must be submitted via e-Filing. These documents may include, but are not necessarily limited to, the following:
- An organogram, illustrative or schematic diagram depicting effective control of the trust. Where the beneficial ownership is in the form of other legal arrangements or legal entities, this should be provided in a separate attachment.
- An Excel spreadsheet containing the above information or such other document(s) that will elaborate on beneficial ownership in relation to the Trust.
When capturing the beneficial ownership information, it is mandatory for the current year’s return that at least one document be submitted that relates to beneficial ownership information. In the event there are more than 20 beneficial owners, the taxpayer must upload a supporting document that reflects the additional beneficial owner(s).
All minutes, excluding those dealing with internal trustee governance arrangements and/or administrative matters, must be submitted.
