With the emigration of South African families, the effectiveness of long-established family trusts is being challenged. Financial planners urge families to reassess their trusts in light of new tax legislation and changing family dynamics.
As more South African families spread across the globe, long-established wealth structures are coming under pressure, particularly family trusts created at a time when beneficiaries still lived and paid tax locally.
Financial planners say the emigration of adult children is increasingly forcing families to reassess whether their trusts still achieve the objectives for which they were originally established.
Desiree Raghubir, associate director and certified financial planner at BDO Wealth, says many trusts were created with a long-term vision of protecting wealth and supporting future generations, but changing family circumstances are exposing new tax and administrative risks.
“Families often set up trusts with a very specific vision in mind, to support children, grandchildren, and long-term legacy goals,” she says. “But as families grow, change, and disperse geographically, those structures don’t always adapt automatically.”
