Your Estate Plan Needs to Keep Up With Your Digital Life
1: SARS Knows About Your Money. Does Your Family?
There was a time when estate planning was relatively straightforward. You owned a house, a car, perhaps a few investments, some furniture and a collection of things your family would argue about after you were gone.
Those days are disappearing.
Today, your wealth might also include cryptocurrency, an online business, a website, valuable domain names, digital content that earns an income, or intellectual property created using artificial intelligence.
And here’s the uncomfortable question: if you passed away tomorrow, would your family even know all these assets existed?
A recent Daily Investor article highlighted concerns raised by DBM Attorneys about digital assets being overlooked, incorrectly valued or difficult for executors to access. These problems can complicate estate administration and create tax difficulties.
The South African Revenue Service (SARS) does not simply ignore an asset because it exists online rather than in a bank account or on a property title deed.
SARS guidance specifically recognises cryptocurrency as an asset in a deceased estate. Its value at the date of death must be considered for estate duty purposes, while the income-tax treatment depends on the circumstances.
You can read the official guidance in the SARS FAQs on deceased estates.
Think about that for a moment. You might have spent years building an online business, investing in crypto or creating something that earns royalties. But if nobody knows where it is, what it is worth or how it can legally be accessed, you may have left your loved ones a puzzle rather than a legacy.
And unlike a puzzle on a Sunday afternoon, this one can have financial and administrative consequences.
2: Your Will Needs to Know About More Than Your House
A will is one of the foundations of a sound estate plan. But having a will and having an estate plan that reflects your actual life are two different things.
Your will should be reviewed as your circumstances change. That includes changes in your family, property, investments, business interests and digital assets.
Consider some examples:
Cryptocurrency: Do your loved ones know that you hold it, and can your executor establish the appropriate legal route to access it?
Online businesses: Does your business generate subscription income, advertising revenue or sales that could be affected if you were no longer available to manage it?
Websites and domain names: Are they valuable business assets, and are the registration details and renewal arrangements documented?
Digital content and intellectual property: Could your work generate future income, and do the relevant contracts allow those rights to be transferred?
Online accounts and cloud storage: Does your executor know which accounts matter, and which are merely personal services that may end when you die?
Not every online account is an inheritable asset. Some rights can be transferred, while others are personal or governed by a platform’s terms and conditions. Your executor must follow the applicable legal and contractual processes.
There is also an important security lesson here: do not put cryptocurrency seed phrases, private keys or sensitive passwords into your will. A will is not the place to leave the keys to your entire digital kingdom.
Instead, keep a secure, updated inventory of your assets and clear instructions for how authorised people can locate the relevant access arrangements. Use appropriate secure storage and ensure your executor or trusted representative knows how to initiate the lawful process.
For more information about how digital assets can affect estate administration, see FNB’s guide to digital assets in a deceased estate.
A will should form part of a broader plan, not serve as a substitute for one.
3: The Tax Bill Does Not Disappear Because You Have
Let’s talk about the part nobody enjoys: tax.
When someone dies, their estate must be administered. That process can involve identifying assets, valuing them, settling liabilities, submitting the relevant tax returns and distributing what remains to the beneficiaries.
The executor has important responsibilities to SARS. These can include dealing with the deceased person’s outstanding tax affairs, submitting applicable returns, accounting for tax arising in the deceased estate and addressing estate duty where applicable.
SARS explains these obligations in its official deceased-estate guidance.
Where assets are missing from the inventory, valuations are unsupported, or tax affairs are incomplete, resolving the issues can take time. Depending on the circumstances, an estate may face additional assessments, penalties or delays. These consequences are not automatic in every case, but they are risks worth taking seriously.
Estate duty is also worth understanding. SARS currently describes a standard abatement of R3.5 million, with duty generally charged at 20% on the first R30 million of dutiable estate value above the applicable abatement and 25% on the amount above R30 million, subject to the relevant rules, deductions and calculations.
That does not mean every estate will owe estate duty. The calculation depends on the estate’s circumstances and the applicable legislation.
And remember: estate planning is not only about estate duty. Liquidity matters too. An estate may own valuable assets but still need accessible funds to settle debts, taxes and administration costs. Life cover and other financial arrangements may play a role in addressing that need, depending on how they are structured and who owns or receives the benefits.
The lesson is simple: don’t leave your executor to discover your financial life one email, bank statement and forgotten login at a time.
For official information on reporting and administering a deceased estate, visit the Master of the High Court.
4: Build Your Wealth. Protect Your Legacy.
At NicTheFA, I believe financial planning should consider more than how much money you can accumulate. It should also consider what happens to that wealth if life doesn’t go according to plan.
That means looking at wealth creation, wealth protection and estate planning together.
You might have investments growing, retirement savings building and insurance protecting your income. But if your will is outdated, your beneficiaries are incorrectly recorded, your tax affairs are incomplete or your family cannot identify your assets, important pieces of the plan may be missing.
Here is a practical starting checklist:
1. Review your will.
Make sure it reflects your current family circumstances, assets and intentions. Obtain appropriate legal advice where necessary.
2. Create an asset inventory.
Include property, bank accounts, investments, policies, business interests, cryptocurrency, domain names and other valuable digital assets.
3. Record where information is held.
Your executor needs to know which institutions and platforms to contact. Keep sensitive access credentials separately and securely.
4. Review your beneficiaries and financial protection.
Check relevant policy nominations and ownership arrangements. Understand how your life cover, investments and other assets may be treated when you die.
5. Keep your tax and business records organised.
Make sure the right people can identify your accountant, tax practitioner, financial adviser and important business contacts.
6. Review the plan when your life changes.
Marriage, divorce, children, a new business, a property purchase or a significant investment can all be reasons to revisit your arrangements.
Estate administration is governed by legal and tax requirements, and a financial adviser is not a substitute for an attorney or tax practitioner. The right professionals can work together to help ensure that your plan is appropriate for your circumstances.
The Department of Justice provides information on deceased estates and the Master of the High Court. SARS also publishes guidance on estate duty and deceased-estate tax obligations
My final thought?
You don’t need to be a cryptocurrency millionaire or own an online empire to benefit from proper estate planning. You simply need to recognise that your financial life is bigger than the documents in your filing cabinet.
Build your wealth with purpose. Protect it with a plan. And make it easier for the people you care about to carry out your wishes when you are no longer there to explain them.
If your will or broader financial plan needs reviewing, visit NicTheFA to explore how financial planning can support your wealth-protection goals.
Disclaimer: This article is for general educational purposes and does not constitute personalised financial, tax or legal advice. Tax treatment and estate-planning requirements depend on individual circumstances and applicable law. Consult appropriately qualified professionals for advice specific to your situation.