Financial Relief for Businesses – Covid-19

Sensitive to the plight of businesses across South Africa flowing from the Covid-19 lock down, the Law Society of South Africa has compiled a list of resources available for financial relief.

Assistance from the Debt Relief Finance Scheme

The Department of Small Business Development is offering assistance to small and medium enterprises (SME) meeting the following criteria:

  • The SME must have been registered with the Companies and Intellectual Property Commission (CIPC) no later than 28 February 2020.
  • The SME must be 100% owned by South African citizens.
  • At least 70% of the employees of the SME must be South African Nationals.
  • The SME should be fully tax compliant.

Applicants must demonstrate the direct or potential financial impact of Covid-19 on the SME in question. SME’s owned by women and/or youth, and SME’s employing people with disabilities will be prioritised.

Please find more information here.

Oppenheimer Fund (SA Future Trust)

The Oppenheimer family have set up a new trust, the SA Future Trust (SAFT), to disburse the family’s R 1 billion that it has pledged to assist employees of small businesses.

This fund is set to provide interest free loans to businesses over a five-year term. In order to qualify, businesses must meet the following criteria:

  • Annual turnover of less than R 25 million.
  • Have been trading for at least two years.
  • Must be in good standing with its bank, statutory creditors and the bureaus as at the end of February 2020.
  • Must be a sustainable business on 29 February 2020.
  • The company must be banking with one of the following banks: ABSA, FNB, Nedbank or Standard Bank.
  • Be able to prove that revenue has been impacted by Covid-19 and therefore requires assistance to pay their permanent staff salaries

The loans are exclusively for the purpose of paying the salaries of permanent employees. The loan has no minimum monthly payment requirements and only needs to be settled in full at the end of the term. Employees carry no liability for the repayment of the loan.

Applications for these loans are to be made through the business’ respective banks.

Unemployment Insurance Fund (Covid-19 TERS)

The Covid-19 TERS Fund is separate from the Unemployment Insurance Fund and is applicable to caring and responsible employers that are unable to pay salaries of workers they send home due to the lock down and are encouraged to apply for assistance. Only businesses that are closed due to the lock down may apply. If shorter hours are worked, UIF must be claimed.

Applications may be found on the UIF website.

South African Revenue Service (SARS)

SARS is offering the following relief:

  • Companies with a turnover less than R 50 million have the option to delay 20% of the company’s Pay As You Earn (PAYE) liability for a period up to four months, starting 1 April 2020 (please note this is not applicable for the March 2020 PAYE that has to have been paid by 7 April 2020). The PAYE liability that is delayed must be paid to SARS in equal instalments over six months starting 01 August 2020.
  • For provisional taxes there is also a delay that will be communicated when the time comes for provisional tax returns.

When a Loved One Passes

A guide to funeral plans, reporting the death, and setting up the deceased’s estate.

Death is an aspect of life that many would rather avoid thinking about. Nevertheless, being armed with knowledge can lessen the hardship. If you are facing the passing of a loved one, we have made a step by step guide to help you through the process, from a practical perspective.

1. Notify the police if necessary

If the deceased died of unnatural causes, you should call the South African Police Services (SAPS) national number (10111) or your nearest Police Station. Do not tamper with the scene.

2. Appoint a funeral director

We recommend that you appoint the services of a funeral director who is affiliated with a recognised Funeral Association within the Federation of Funeral Professionals in South Africa.

Make sure that the funeral director understands and respects the religious practises of the deceased.

3. Identify the deceased

Someone who knew the deceased well will need to identify them. In order for this to happen, this person must produce their identity document or passport, as well as the identity document or passport of the deceased. If this is not done at the scene of the death, it will be done at the mortuary.

4. Inform family and friends

Reach out to both your loved ones and the loved ones of the deceased. This will be a time when you will all need comfort. From a pragmatic standpoint, you can take this as an opportunity to allocate tasks, including observing religious rites, appointing a funeral director and asking religious leaders for guidance on the burial preparations and service.

You should also eventually notify employers, employees and clients of the deceased.

5. Get a Notice of Death and a Death Certificate

Always keep the original Notice of Death and Death Certificate. Make multiple copies and have a commissioner of oaths certify them for you.

A medical practitioner or a member of the SAPS should issue a Notice of Death. Some traditional leaders or your funeral director may also be able to assist. A Notice of Death can be used for insurance claims. If your funeral director does not issue you with a Death Certificate, you may obtain a Death Certificate from the Department of Home Affairs after submitting the Notice of Death.

6. Arrange for the body to be moved to a mortuary or funeral home

If no foul play is suspected, your funeral director may take the body to their facilities. Otherwise, it will first need to be taken to the state mortuary for an autopsy.

7. Contact your funeral policy insurer and UIF

Find out from your insurer exactly what they need for a claim on their policy, and submit this to them. If the deceased contributed to UIF, their spouse or minor child(ren) may also be entitled to a dependant benefit for a period of time.

8. Find the will and contact the executor

The will should give direction on how to handle the assets of the deceased, and an executor should be nominated. The estate must be reported to the Master of the High Court. If the deceased made use of the services of De Wet – Van der Watt in drafting their will, we should have a copy of the will.

9. Deal with the possessions of the deceased

If the deceased lived alone, make sure that their residence is secure, check for any perishable food and take care of pets. Depending on the beliefs and customs of your loved one, you may also need to turn the mirrors and pictures around, remove the bed and close the curtains.

Going through your loved one’s personal effects can be emotionally taxing. Consider discussing with your family and collectively deciding how to go about this. Set aside a substantial amount of time to sort through the possessions. When it comes to distributing items, it’s always best to seek the advice of a qualified third party. De Wet – Van der Watt has been helping people with this for decades, and can assist in this regard.

It’s never easy to deal with the loss of a loved one. We believe in doing what we can to allow you to move forward with dignity and closure. That’s why we handle the legal side of things efficiently and delicately – remembering the person who passed and honouring their legacy.

Covid-19 Pandemic

Until the 17 April we are obliged and will work from our homes; we also can’t meet with clients, get documents signed, or register transfers at the Deeds Office or get Executorship letters from the Master of the High Court.

But we CAN –

  • Advise and draft Wills (bit macabre in the circumstances but important) then send them to you for signature with instructions on signing;
  • Draft Partnership agreements, shareholder’s agreements, Antenuptial agreements and co-habitation agreements for you to consider and, if a notary is needed, sign when we can get together;
  • Advise and draft sale agreements, especially for homes, apartments, investment properties and apartment blocks;
  • Start the administration of an estate by advising the banks, SARS, creditors and debtors, even though we would have to wait for the Letters of Executorship before any real work can be done;
  • Prepare and advise on a Trust and draw the Trust Deed and supporting documents for your approval, signature and Lodgement with the Master of the High Court after the 16 April, 2020 to get Letters of Authority.

Give Duncan a call on 083 381 2739 and he will refer you to the correct person to handle your matter.

Why should you choose your own conveyancer?

You might not realise it, but if you are selling your property, it is very important that you (and not your estate agent or the buyer) choose the right conveyancer for you. Even though the purchaser is responsible for the costs of the conveyancer, the risk to the seller must not be overlooked.

If for instance the buyer takes early occupation and their bond repayments are higher than the occupational rent, they may consider it to be in their interests to delay the transfer for as long as possible. A skilled conveyancer will have the transfer process moving as quickly as possible.

As the seller, unless you have agreed otherwise, you have the right to choose an attorney. This right is recognised in common law precisely because the disproportionate risk to the seller is acknowledged.

Do not give up this right! Contact us today if you would like to know more.

Executors and you

What happens after we die? We might not be the authority on perennial, existential questions, but we can give you an idea of the bureaucratic processes that must be followed in South Africa.

When someone dies, their belongings and their liabilities need to be administered – creditors need to be paid, possessions and money need to be given to beneficiaries, paperwork must be compiled and submitted to the Master of the High Court, estate duty must be calculated and paid to SARS (to name a few of these responsibilities). The person (or people) who perform this task are Executors.

Anyone capable of executing a valid will may choose their preferred executor. It should be someone that the testator (person who signs a will) trusts to look after their interests and carry out their wishes. It is the duty of the executor to use the funds of the deceased estate to pay for:

  1. The funeral expenses;
  2. The legal expenses of winding up the estate;
  3. Taxes owed by the deceased; and finally
  4. All other debts owed by the deceased.

An executor is expected to have knowledge of the law and procedure around deceased estates. They will be held personally liable if they are negligent in the exercise of their duties. For this reason, executors without such knowledge and experience should approach a legal specialist (such as De Wet -Van der Watt) to represent and assist them in their tasks. We at De Wet Van der Watt are so confident in our abilities that we usually encourage people to nominate their trusted loved ones (rather than nominate us) as executors. This means that if the executor is for whatever reason not happy with the service that they are receiving from us, they may terminate our mandate and seek help elsewhere.

While the testator may nominate an executor, it is the Master of the High Court (where deceased estates are registered) that will appoint the executor. If they believe that the nominated executor is not fit for the role, an alternative executor may be appointed. The appointment of an alternative executor might not be ideal. A trusted loved one might be more suitably motivated to finalise the estate and to follow courses of action the lead to the greatest utility of the estate.

Before you decide who you wish to nominate as the executor of your estate, schedule a consultation with one of the experts in deceased estates at De Wet – Van der Watt. They are equipped to help you out with any specific concerns that you have around this issue.

Antenuptial Contracts

Under South African law, if you marry without an Antenuptial or Pre-nuptial Contract, then you are married in community of property. Marriage in community of property means that all your assets are joined together and both of you control it together. This is not altogether bad as both parties have to discuss and agree how their money is to be spent or saved and, one spouse cannot bind their joint estate as surety for a third party without the consent of the other spouse.

More sophisticated couples normally prefer to control their own goods and sign an Antenuptial Contract (before they get married of course) agreeing that they will each look after their own estate and will not be responsible for the debts or outgoings of their loved one. This is a normal contract and a precedent of one is available here. This also means that if one of the parties goes bankrupt, this does not affect the estate of the other party which stays independent.

It was found that, as is usual in most marriages, when the couple are blessed with children, one spouse’s career path (historically that of the woman) is interrupted as they take care of the young ones. This means that, if the marriage terminates through divorce (a marriage can only terminate through death or divorce and happily only 30% terminate in divorce), the one spouse has the money and the other has the children with a great need for the money; this often leads to acrimonious fights through the courts. It is also unfair that both parties work equally hard but only one is paid money while the other gets the more valuable relationships.

In 1984 the Matrimonial Property Act provided that, unless it was especially excluded, an accrual system would apply to everyone who concluded an Antenuptial Contract. The accrual system simply means that, at the termination of the marriage (divorce or death), whoever has less assets can claim enough from the other party to make sure they both have the same amount.

At the start of the marriage the parties can agree to exclude some assets or their value from the accrual; this is because that party acquired or built up their estate before they joined together as partners. Normally excluded are also any inheritance, gift from the other party and personal damages that one party suffers. A precedent of the usual contract can be found here. We choose to include all the provisions rather than refer to the Act as we don’t know where the parties will be when the marriage terminates and it would be inconvenient to get a South African law expert to explain the law in Outer Mongolia 😊.

Once the Contract is signed before a Notary it is registered by the Registrar of Deeds, microfilmed and the original returned to the parties. The Marriage Officer only needs a letter from the Notary confirming the Contract, not the contract itself, which means it can be signed a few minutes before the “I do” is spoken – although it is best to discuss and sign at least a few days before the wedding.

There are other interesting implications and possible provisions which can be discussed with your Notary. Contact our friendly team to schedule a consultation.