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Financial Statements for Trusts in South Africa

Last updated: 2026-03-19

Trusts in South Africa must maintain proper accounting records and prepare financial statements, but the requirements differ from companies. The Trust Property Control Act requires trustees to keep accurate records of all trust transactions and to account to the Master of the High Court when requested. The Master may also require trustees to provide security (a guarantee) for the trust assets.

Trust financial statements typically include an income statement, balance sheet, and a distribution statement showing how income and capital were allocated among beneficiaries. The distribution statement is particularly important because it directly affects how income is taxed — distributed income is taxed in beneficiaries' hands while retained income bears the 45% trust tax rate.

Audit and independent review requirements apply to trusts in the same way as to other entities, based on the Public Interest Score. However, most private trusts fall well below these thresholds. The Master can independently require an audit of trust affairs if there are concerns about trustee conduct, regardless of the PI Score.

Key Requirements

Key requirements
Requirement
Proper accounting records of all trust transactions
Annual financial statements including distribution statement
Audit/review if Public Interest Score thresholds are met
Master of the High Court may independently require an audit
Asset register of all trust property
Records retained for minimum of five years

Important Deadlines

Important deadlines
Deadline
Financial statements prepared annually for tax return
Records available to Master upon request
Trustee accounting to beneficiaries: within reasonable time

Fees & Costs

Fees and costs
ItemAmount
Trust financial statements (accountant)R3,000–R15,000
Trust audit (if required)R15,000–R60,000
Trust accounting softwareTypical market costR300–R1,500/month

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Non-Compliance Penalties

Non-compliance penalties
Penalty
Failure to keep proper records: breach of fiduciary duty
Trustee personal liability for losses caused by poor record-keeping
Master can remove trustees for failure to account
SARS may estimate trust income if records are inadequate

Frequently Asked Questions

Does a trust need audited financial statements?
Only if the PI Score exceeds 350 or if the Master specifically requires it. Most private trusts do not need an audit. However, the Master has the power to require an audit of any trust at any time if there are concerns about trustee conduct or trust administration.
What is a trust distribution statement?
A distribution statement records how the trust's income and capital gains were distributed among beneficiaries during the year. This is crucial for tax purposes because distributed income is taxed in beneficiaries' hands (potentially at lower rates) while retained income is taxed at 45% in the trust.
Can trustees be held personally liable for accounting failures?
Yes. Trustees have a fiduciary duty to maintain proper records. If a trustee fails to keep adequate records and the trust or beneficiaries suffer losses as a result, the trustee can be held personally liable. The Master can also remove a trustee for failure to account.

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