Statistics show 50% of South Africans can’t afford to die and 75% of South Africans die without a will or with an incorrectly structured will.
Estate and succession planning are uncomfortable topics, but it is imperative to work through these topics to ensure your business and loved ones are cared for once you are gone. In agriculture, business disruptions as a result of the death of a producer or landowner can often be managed more effectively by structuring your business and its associated assets in an alternative ownership structure, for example by changing a sole proprietorship to a private company because operating legal structures and owned assets influence and determine taxation rates.
Statistics show that a sole proprietorship is still the dominant business form in commercial agriculture in South Africa. This is, however, not always the most effective legal form of operation if an asset ownership and estate planning perspective is considered.
There are various allowable legal structures available, but these need to be aligned to the needs of the owner(s), their family and their business.
We therefore encourage farmers to consult with their estate planners to explore these issues and opportunities. Absa has a team of experts that can assist you with your estate planning. If you need help with these issues mentioned above, contact Agribusiness@absa.co.za or call 011 350 8000 so that we can connect you with an expert estate planner today.