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Which of these applies to you?

  • My spouse is important and I’d have it no other way, or

  • No way, I wish I was still single.

I’m a huge fan of the first group.

That’s because the single life sucks.

It’s pretty cool being young and single – pretty awful being old and single.

In your twenties… 

  • you can pick up partners left, right, and centre.

In your forties…

  • they run and hide when they see you coming? Is it the ‘beer belly’? The Old Spice deodorant? The desperate look in the eyes?

But having a spouse has important financial benefits as well

Here are three excellent reasons for getting married and staying married:

One – Estate Duty.

Anything you leave to a spouse is free from estate duty.
Bear in mind that estate duty is levied at 20%, so if that sounds like nothing, imagine for a moment paying 20% tax on a million Rand – R200, 000 is nothing to sneeze at.

Two – Capital Gains Tax.

Transfers of assets between spouses is free of capital gains tax.
That’s because the transfer of an asset between spouses takes place at ‘base’ cost. Base cost is the price you paid for the asset when you bought it. Capital gains tax is charged on the difference between what the asset is sold for versus what you paid for it.

Three – Donations Tax.

Donations between spouse are free of donations tax which is a tax of 20%.

But in order to get all these financial benefits, you need to have a spouse. Girlfriends and boyfriends don’t count!

So how do you know whether you have a spouse?

Here’s a checklist of three things which will help you decide whether the person you’re living with is your spouse:

  1. A partner in a marriage or customary union recognised in terms of the laws of the Republic
  2. A partner in a union recognised as a marriage in accordance with the tenets of any religion, or
  3. A partner in a same-sex or heterosexual (different sex) union which the commissioner is satisfied is intended to be permanent

Only the first one can be “community of property”. The second and third are considered to be “out of community of property”.

So now that you’ve figured out you’ve got a spouse, are there any laws you need to be aware of?

We’d suggest you familiarise yourself with the following acts:

  • The Marriage Act 25 of 1961
  • The Recognition of Customary Marriages Act 120 f 1998
  • The Civil Union Act 17 of 2006
  • The Matrimonial Property Act 88 of 1984
  • The Maintenance of Surviving Spouses Act 27 of 1990

There you have it.

Having a spouse is very important when it comes to things like:

  • Income tax (which includes capital gains tax)
  • Estate duty
  • Transfer duty, and
  • Donations tax

This brings up the question of: “Is Common Law marriage recognised in South Africa?
The answer isn’t what you’d expect, but that’s the subject of another article.

Until next time.

The InsuranceFundi Team