If trusts had a hall of fame for self-inflicted disasters, two things would be inducted immediately:
badly drafted trust deeds and “we’ll sort the paperwork later” administration.
Spoiler: later is now, and both the Master and South African Revenue Service are paying very close attention.
Paperwork isn’t admin fluff, it’s the trust’s lifeline
One of the fastest ways to land your trust under forensic scrutiny is sloppy record-keeping. Trustees who fail to properly document resolutions and minutes, clearly recording when, why and how decisions were made, are effectively inviting regulators to assume the worst.
Every decision taken on behalf of a trust must be:
• formally resolved
• properly minuted
• approved by the trustees
No resolution = no decision. And “we discussed it over coffee” does not count.
The trust deed you forgot to review may already be sabotaging you
A trust deed is not a set-and-forget document. When poorly drafted, it can quietly restrict trustees’ powers and create long-term consequences that only surface when it’s too late, usually when beneficiaries want answers or assets.
Regular reviews of:
• the trust deed
• the trustees
• the beneficiaries
are essential. Without them, a trust can very quickly mutate from a protective estate-planning tool into a liability factory.
SARS has upgraded. Trusts have not all kept up.
Over the past two years, SARS has gone from “administratively annoyed” to technologically aggressive.
Its systems now:
• use artificial intelligence to detect backdated resolutions
• cross-check trust data with the Master of the High Court
• flag trusts that haven’t filed tax returns
And no, being “dormant” is no longer a get-out-of-jail-free card.
SARS has made it clear: penalties for non-compliant trust tax returns are coming in early 2026. This applies to all trusts. Quiet ones included.
“But the trust doesn’t have a bank account…”
This excuse no longer survives contact with the law.
The Trust Property Control Act makes it crystal clear:
If you receive money in your capacity as a trustee, it must be deposited into a separate trust bank account.
This is mandatory. Not optional. Not negotiable.
Trust tax returns are now linked to bank account details. A trust without a bank account is no longer “inactive,” it’s non-compliant.
Your cousin is not a compliance strategy
Appointing friends or family as trustees often feels convenient… until administration actually has to happen.
All trustees must:
• actively participate in decisions
• understand their legal duties
• act independently and objectively
Without this, trusts risk being labelled alter ego trusts, which defeats the entire purpose of having one.
An independent trustee isn’t bureaucracy, it’s protection.
The uncomfortable truth
Most trust problems are not caused by bad intentions.
They’re caused by neglect, over-confidence, and DIY administration.
The most reliable way to avoid compliance failures is to involve professionals who deal with trusts every day, not only when SARS starts asking questions.
If you’re unsure whether your trust complies with the Master’s requirements or SARS’ latest enforcement standards, our Trust Office specialises in trust and tax administration and compliance and is ready to assist.
Because the only thing worse than fixing a broken trust…
is explaining to beneficiaries why it broke.
