Trusts to Submit Beneficial Ownership Information - What You Need to Know
In a recent media statement, the Department of Justice warned that the low compliance rate in submitting beneficial ownership information for trusts is expected to jeopardise South Africa's chances of meeting the January 2025 deadline for exiting the greylist. In response, trusts are warned to submit outstanding beneficial ownership registers by 15 November 2024 or face harsher punishment.
Beneficial Ownership for Trusts
Beneficial ownership (BO) refers to the natural person(s) who ultimately owns, controls or benefits from a legal entity, such as a trust. South Africa's greylisting by the Financial Action Task Force (FATF) in February 2023 has necessitated more robust compliance measures, including strict transparency of beneficial ownership for trusts and other legal entities. The General Laws Amendment Act, 22 of 2022, was enacted to address these requirements, mandating trustees to submit BO information to ensure South African authorities can access accurate and up-to-date BO data. The requirements were included in the amended Trust Property Control Act, 57 of 1988.
This act significantly pressures trustees to disclose BO information and ensures that trustees maintain ongoing compliance through accurate record-keeping. The Chief Master’s Directive 8 of 2023 clarified the process for submitting BO information related to trusts and established the legal framework to which trustees must adhere.
Who are the Beneficial Owners of Trusts?
The Trust Property Control Act (TPCA) defines ‘beneficial owners’ as the founders, trustees, named beneficiaries, and any individuals who effectively control a trust. A beneficial owner must always be a natural person. When a legal entity is a beneficial owner, the natural person(s) who ultimately benefit from or control the legal entity must be identified and recorded as the trust's beneficial owners.
Key Requirements for Trusts
Trustees are obligated to:
Identify Beneficial Owners
The list of beneficial owners can be extensive, depending on the trust's structure, as it includes multiple categories of individuals associated with ownership, control, and benefit from the trust.
Beneficial owners of a trust are natural persons (individuals) who:
Own the assets held in trust or exercise control over the administration of the trust or how the trust is managed.
The founder(s) of the trust. If the founder is a legal person, the beneficial owner would be the individual(s) with effective control of the legal entity or partnership
The trustees of the trust. If the trustee is a legal person, the beneficial owner is the individual acting on behalf of that entity or partnership or the person who controls it.
The beneficiaries listed in the trust deed. If a beneficiary is a legal person, the beneficial owner would be the natural person who ultimately controls that entity.
Keep BO records up-to-date
Trustees must keep the following information on beneficial owners ensuring that these are accurate and up-to-date:
Full names
Date of birth
Nationality
ID Type and the issuing country (e.g., ID number, passport number, or registration number)
Citizenship
Residential address
Address for service of notices (if different from the residential address)
Other means of contact (e.g., email address, phone number)
Tax number (if the person is a registered taxpayer in the Republic)
The class or category of beneficial ownership under which the person falls (i.e. trustee, beneficiary, etc.)
The date on which the person became a beneficial owner of the trust
The date the person ceased to be a beneficial owner (if applicable)
For minors, include the guardian's name and surname, residential and postal address, identity number, and contact details.
Trustees and trust administrators can use the Trust Beneficial Ownership Register template provided on the website to keep the information up to date.
Submit BO information to the Master
BO information must be submitted electronically through the Master's online platform. The submission is done online. It involves:
Logging into the Master’s Trust Beneficial Ownership Register Online System.
Searching for the relevant trust using the provided trust number.
Updating trustee details if necessary and lodging BO information.
NOTE: Ensure proper format and validation of BO information during upload.
For more guidance on how to submit the information download the Quick Guide - Trust Beneficial Ownership Register here.
Useful Tips:
If you received an "Account has been locked" message and cannot log in, first try refreshing your browser. If this does not resolve the problem, wait 30 minutes and try logging in again.
If you haven't received your login pin, check your spam or junk mail folder. If it’s not there, try logging in again. Ensure that your mail service provider hasn’t blocked the email.
If the "Trust Beneficial Ownership Register" button is greyed out, complete the search for your trust. After finding the trust, the option to upload BO information should be activated.
When there are validation errors during the upload, double-check the captured data, as highlighted areas may indicate mistakes or missing information. Ensure the trust number follows the correct format: starting with IT (inter vivos trusts) or MT (testamentary trusts), followed by a 6-digit number, year, and suffix (if applicable).
Technical support guidance is provided for difficulties accessing the system, including troubleshooting steps for locked accounts and validation errors. Support requests or enquiries can be mailed to DojDEOnlineSupport@justice.gov.za.
By following the outlined process and troubleshooting tips, trustees can ensure they meet the requirements for submitting beneficial ownership information in a timely and accurate manner.
Penalties for Non-compliance
Failure to comply with these requirements can result in substantial penalties, including fines (up to R10 million) and/or imprisonment for trustees. The Master of the High Court or the Financial Intelligence Centre may apply additional sanctions.
Changes lodged with the Master of the High Court can trigger an inspection of the Beneficial Ownership database, which may result in penalties for non-compliance.
Who can access the BO information?
Regulatory bodies like the Financial Intelligence Centre (FIC) and other designated authorities will have access to this information to monitor compliance and investigate financial crimes. The National Prosecuting Authority, the Special Investigating Unit and South African Revenue Service are some of the entities that can access this information.·
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