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Trusts and Estate Planning

So you are married in Community of Property. Damn! That means that if one of you gets sequestrated (bankrupt) you both go down together. Very romantic, but totally unnecessary.

Form a Trust – Your first line of defense

You can solve part of the problem by moving your growth assets to a Trust, but what about your home and your shares in a professional practice? They’ll be held in your own or your spouse’s name.

Antenuptial Contracts – Your safety  net

The good news is that you can convert to an Antenuptial Contract (I suppose it is called a Post-Nuptial contract, but the efffect is the same).

Take my position, for instance. I have a 50% share in a very high risk professional practice (auditing and accounting). If creditors/shareholders/banks go for one of our clients, chances are they’ll go for us as well. But those shares have to be held by me (one of the rules of the profession). So my wife owns the family home. If I go down (again – been there, done that!), at least we have somewhere to live – we are married under an ANC with the accrual system.

Convert your wealth to separate estates

We can’t help you, but my attorney client and friend, Dino Tserkezis of KG Tserkezis Inc ( dino@kgt.co.za ) advises me that if you are married in Community of Property, you can apply to the High Court to convert your joint estate (wealth) to separate estates. The proposal has to be published in the newspapers and Government Gazette and there is due process. If there are no objections by creditors and everything goes smoothly, the current cost is about R40 000 all in. Of course, if problems arise, then the costs will be higher.

A word of caution. If you are married under an ANC and one of you makes a donation to the other (one way of shifting assets from one estate to the next free of donations tax), those assets then fall outside of the accrual and the receiving spouse has sole title to them.

Another word of caution. If you see the bankruptcy coming and you go through the above process in anticipation of the coming attack by creditors, chances are that the courts will overturn what you’ve done.

This lesson in life? Same old one – there’s always a better way to do something. Think out of the box. Get divorced and then re-marry under ANC. Just make sure she’ll have you back!


Derek Springett, CEO of HArbour & AssociatesNeed help with converting your COP marriage to ANC?

Contact us today or set up a free meeting with our CEO, Derek Springett, to discuss your options.
We have been offering expert financial advice and business services since 1971.
You can also visit our online store to see our list of financial services.


Need help with your Investments?

Contact us today or set up a free meeting with our CEO, Derek Springett, to discuss your options. We have been offering expert financial advice and business services since 1971. You can also visit our online store to see our list of financial services.