In the studio of Anton Smit
Your business, ready to carry on without you.
Buy-and-sell agreements, key person cover and succession plans for owner-managed businesses, arranged by CERTIFIED FINANCIAL PLANNER® professionals alongside your attorney and accountant.
Sixty minutes, at our cost, at our Durbanville office or online. Partners are welcome.
Who we usually help.
Business owners usually come to us at one of these moments.
- You have business partners and no signed agreement for what happens if one of you dies or becomes disabled.
- The business depends on one or two people, and losing either would hurt its profit and its value.
- You have lent money to the company or signed personal guarantees for its debts.
- You plan to sell the business, or hand it to family or management, within the next ten years.
Four questions, in order.
Every succession plan comes back to the same four questions. We answer them in writing, with your attorney and accountant.
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Who buys your share?
A buy-and-sell agreement sets out who buys a deceased or disabled owner's share and loan account, and at what price. Life cover held by the other owners pays for it, so they are not left to find the cash.
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What if a key person is lost?
Key person cover pays the business if someone it depends on dies or is disabled. At the outset the business chooses: deduct the premiums and pay tax on the payout, or forgo the deduction and receive the payout tax-free. The choice cannot be changed later.
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What is owed, and to whom?
Money you have lent the company becomes a claim in your estate, and personal guarantees for business debts can fall on it too. Cover can settle both, so neither the business nor your family is left exposed.
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How will the owners retire?
Owners often hold most of their wealth in the business. Your company can contribute to your retirement fund: it deducts the contribution, which is taxed as your fringe benefit and counts towards your own 27.5% limit. A sale should not be the only plan.
Faith, Anton Smit. Photograph: Delaire Graff Estate
Death is the risk professionals insure. Losing the ability to work is the risk they actually run.
The Asset That Walks Into the Room, BKA Wealth Journal
Tax points worth knowing.
How the 2026/27 rules treat the structures owner-managed businesses use most.
- Company tax
- Companies pay 27% income tax, and 20% dividends tax is withheld when profits are paid to individuals as dividends. Qualifying small business corporations pay 0% on their first R99,000 of taxable income, as proposed in Budget 2026.
- Buy-and-sell policies
- Premiums are generally not tax-deductible. Set up correctly, a payout used to buy a deceased owner's interest is generally free of capital gains tax and excluded from their estate for estate duty, provided the deceased did not pay or bear the premiums.
- Key person policies
- To deduct premiums, the policy must be pure risk cover with no cash value, owned by the business, and the payout is then taxable. If premiums are not deducted, the payout is tax-free.
- Selling at 55 or older
- When an owner aged 55 or older sells, or the business passes on death or through ill-health, up to R2.7 million of the gain can be excluded from capital gains tax, for businesses worth up to R15 million. These amounts, up from R1.8 million and R10 million, were proposed in Budget 2026. The assets must usually have been held for five years.
- Loan accounts
- A loan you have made to your company is an asset in your estate, and your executor will claim it from the business. A buy-and-sell agreement can include the loan account, so that it is settled together with the shares.
Common questions.
Do we need a buy-and-sell agreement if my partner is family?
Usually, yes. Without one, a deceased owner's share passes under their will, and the remaining owners may find themselves in business with heirs who would rather have cash than shares.
Who drafts the agreement?
An attorney drafts the buy-and-sell agreement. We work out the value to be covered, structure the policies, and check that the agreement and the policies say the same thing.
How often should the cover be reviewed?
Whenever the value of the business changes materially or an owner joins or leaves, and otherwise at your annual review.
Figures checked on 11 September 2026 against the SARS 2026/27 Budget Tax Guide, SARS on estate duty and buy-and-sell agreements, the SARS guide to capital gains tax and SARS on small business assets. Amounts that apply from 1 March 2026 were announced in Budget 2026 and are applied by SARS; they remain subject to Parliament's legislative process.
Talk your business plan through with a CFP® professional.
Sixty minutes at our cost, at our Durbanville office or online. Partners and co-directors are welcome to join.
[email protected] · 021 976 0738
Unit 3, Kings Landing Building, 17 King Street, Durbanville, 7550
