Following these amendments to the Trust Property Control Act, the Master of the High Court published a directive on 17 October 2023, introducing a new platform for the submission of beneficial ownership (BO) registers by trustees. The consequence for non-compliance with the BO reporting includes a fine of up to R10 million and/or a period of imprisonment not exceeding five years.
For purposes of a trust, a ‘beneficial owner’ inter alia includes –
- a natural person who directly or indirectly ultimately owns the trust property.
- a natural person who exercises effective control over the administration of the trust pursuant to the provisions of the trust deed.
- the trust founder.
- each trustee of the trust; and each beneficiary of the trust.
In terms of the amended section 11(A)(1) of the Trust Property Control Act, trustees are required to –
- establish and record the BO of a trust.
- maintain a record of the prescribed information pertaining to the BO of the trust.
- submit the BO register to the Master on the electronic platform provided by the Master, and ensure that the BO information remains updated.
All BO information lodged on the electronic platform established by the Master will be available to various enforcement agencies, including, among others, the South African Revenue Service and the Financial Intelligence Centre.
However, such BO reporting is only applicable to registered trusts. Accordingly, dormant and/or deregistered trusts are exempted from providing BO information to the Master. Importantly, such dormant or deregistered trusts are required to send an electronic mail to the Master together with the respective declaration form (obtained from the Master) confirming that the trust is either dormant or deregistered, together with a copy of the identity document of the trustee making the declaration, as well as all relevant supporting documentation.
Should a trust cease to be dormant, the trustees will be required to comply with the Beneficial Ownership reporting requirements applicable to an active registered trust.
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