Your Trust Is Not Active? SARS Still Wants Your Trust Return
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Your client calls. Their trust hasn't traded in years. It just holds shares. No income, no activity, no problem, right?
Wrong. And if you don't fix it before 4 May 2026, SARS will fix it for you. With a penalty notice.
Do All Trusts Need to Register for Tax?
Here is the misconception that is about to cost thousands of trustees money: that "passive" means "exempt." It does not.
SARS is unambiguous on this point. A trust is included in the definition of a "person" in terms of the Income Tax Act, 1962. That means that every resident trust, regardless of whether it trades, earns income, holds assets, or sits completely dormant, must register for income tax and submit an annual ITR12T return.
There are no exceptions for activity level, size, or structure.
A trust that merely holds shares and does not trade in its own right is still required to file. The fact that it holds shares means it likely receives dividends, has capital distributions at some point, or has beneficiaries to whom income or gains are or will be vested, all of which are reportable events. Even if the taxable amount is nil. Even if everything flows through to beneficiaries. The ITR12T must still be submitted.
SARS has been building to this moment. Final demands were issued in February 2026 for outstanding 2024 and 2025 returns. On 27 March 2026, SARS issued Notice 7314, formally listing the failure by a trust to submit an income tax return as an incidence of non-compliance under sections 210 and 211 of the Tax Administration Act. This was not a policy statement. It was a legally binding notice, published in the Government Gazette. The penalty clock starts ticking on 4 May 2026.
What the Penalties Actually Look Like
This is where it gets expensive. The fixed amount penalty is triggered when:
A trust has an outstanding ITR12T for any year of assessment commencing on or after 1 March 2023
SARS has issued a final demand referencing Notice 7314, and
The trust fails to submit within 21 business days of that demand.
The penalty amount is determined by the trust's assessed loss or taxable income, and ranges from R250 to R16 000 per month, imposed for up to 35 months. This fine will accumulate monthly until the non-compliance is corrected.
For a trust that has done nothing for three years, the exposure across multiple outstanding returns could be substantial. And SARS will not accept an outdated postal address as an excuse. If a final demand was sent to an address no longer reflected on the RAV01, the 21-day window still runs.
Estimates suggest that up to two-thirds of all trusts registered with the Master of the High Court are not yet registered as taxpayers with SARS. If your client base includes family trusts, estate planning structures, or shareholding trusts of any kind, the odds are high that at least one of them is in this group.
The Legal Obligations That Have Been in Place Since 2023
Some trustees are under the impression that SARS is doing something new. It is not. The obligation has existed for years, SARS is simply enforcing it. Public Notice 6217, issued under section 66(1) of the Income Tax Act, states clearly that “every trust that was a resident during the 2025 year of assessment must submit an income tax return” without reference to income earned or any other conditions. An equivalent notice, Public Notice 4918 of 2024 contains the same requirement to the 2024 year of assessment. Both notices are in effect. Both are ignored by far too many trustees.
The SARS Trusts webpage states it plainly: "The representative taxpayer (the trustee/s of a Trust) or the appointed tax practitioner MUST file an ITR12T every year."
What To Do Before 4 May 2026 — Four Steps
Time is short. Here is the action plan for every trust in your client portfolio that is not fully up to date.
Step 1 — Register the trust for income tax, if not already done.
Use the [SARS Online Trust Registration portal] (https://tools.sars.gov.za/sarsonlinequery/trustregistration/) or visit a branch with an appointment. Trusts registered after 1 March 2026 could already face penalties for prior years, so do not delay this.
Step 2 — File all outstanding ITR12T returns for the 2024 and 2025 years of assessment immediately.
Do not wait for a final demand. Submitting before a demand is issued keeps the trust out of the formal penalty process. This is the most important action you can take right now. Note that from the 2023 year of assessment, all mandatory supporting documents must be uploaded with the return — this includes the trust instrument, annual financial statements, and resolutions or minutes of trustee meetings.
Step 3 — Verify and update contact details on SARS RAV01.
A final demand sent to an outdated address does not pause or extend the 21-day compliance window. Check that the trust's registered address, contact numbers, and representative taxpayer details are current on the system.
Step 4 — Check all outstanding years from 1 March 2023 onwards.
The notice applies retrospectively to that date. A trust that has filed nothing for three years is not under the radar, it is overdue for three years of returns simultaneously. Work through each year of assessment systematically. If the trust was deregistered with the Master of the High Court or qualifies for deregistration, that process also requires all outstanding returns to be submitted and liabilities settled before a deregistration request can be made.
This Is an Opportunity for Your Practice
Every trust client in your portfolio is a conversation waiting to happen. Most trustees are not ignoring SARS out of arrogance, they genuinely do not know the law has always required this. You do, and that knowledge is valuable, and it is billable. Trustees who receive an unexpected AP34 penalty notice in May will be looking for someone to help them respond, manage the remission process, and get back into compliance.
Be the practitioner who calls them first. Review your client list this week. Identify every trust that may have outstanding ITR12T obligations. Make the call. That call protects your client, positions you as an indispensable advisor, and opens a compliance services conversation that may extend well beyond trust tax.
Bottom Line
SARS has given trustees every warning they need. The February 2026 final demands. The March 2026 gazette notice. The April 2026 stakeholder communication. The 4 May 2026 deadline.
After that date, penalty assessment notices start going out. They will keep arriving every month until the non-compliance is corrected. The structure of the trust does not matter. Whether it trades or holds shares or sits empty does not matter. If it is registered with the Master of the High Court, it is required to be registered with SARS and to file every year.
The window to fix this without a penalty is still open. Barely.
Watch the SARS webinar by clicking here and learn more about trusts and their responsibilities.
