For decades, South African families and businesses have used trusts to hold and manage assets, provide for beneficiaries, structure estates and protect the interests of children or other vulnerable people.
Now the legislation governing those trusts could be substantially rewritten.
On 7 August 2026, the Department of Justice and Constitutional Development published the Regulation of Trusts Bill, 2026 (“the Bill”) for public comment in Government Gazette 55166. If ultimately passed and brought into force, it would repeal and replace the Trust Property Control Act 57 of 1988 (“the Trust Property Control Act”), the legislation that has formed the backbone of South African trust administration for more than three decades. Public comments on the draft close on 11 September 2026.
The important word is draft. The Regulation of Trusts Bill is not yet law, and trustees should not treat every proposal in it as a current legal requirement. Nevertheless, the Bill shows clearly where government wants trust regulation to move: more formal administration, greater accountability, stronger powers for the Master of the High Court and potentially serious consequences for non-compliance.
Why is South Africa changing its trust law?
Cabinet has described the purpose of the Bill as modernising South Africa’s trust framework, strengthening accountability and compliance, enhancing the Master’s oversight role and providing greater protection for beneficiaries.
That does not mean trusts are currently unregulated.
The existing Trust Property Control Act already requires trustees to act with appropriate care, separate trust property from their own property and comply with the terms of the trust instrument. It was also significantly amended by the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022, with important provisions taking effect on 1 April 2023.
Those amendments introduced existing obligations relating to beneficial ownership. Trustees are already required to establish and maintain beneficial-ownership information and lodge the required register with the Master. This is therefore not a completely new obligation created for the first time by the 2026 Bill.
What the new Bill proposes is a broader, more comprehensive framework for the life of a trust—from creation and trustee authorisation to financial reporting, beneficial ownership, enforcement, resignation, removal and eventual termination.
Annual financial statements could become a normal part of trust administration
One of the most noticeable proposals appears in section 20 of the Bill.
It provides that a trustee must cause annual financial statements to be prepared for the trust each year. The Bill does contemplate an exemption where the trust instrument itself does not require financial statements and the trust’s annual aggregate inflows and outflows fall below a threshold that would still have to be determined by the Minister.
Existing trusts that are already preparing annual financial statements would have to continue doing so. Where an existing trust was not doing so and no exemption applied, the proposed law would require the first annual financial statements within six months after commencement.
For ordinary trustees, the practical message is simple: informal recordkeeping may become increasingly difficult to justify.
A family trust may feel personal, particularly where the trustees and beneficiaries are related, but the trust remains a separate legal arrangement with fiduciary responsibilities.
A new annual return is also proposed
Section 21 goes further by proposing an annual return to the Master.
For a new trust, the return would have to be filed within six months after the anniversary of the date on which its first trustee was authorised by the Master. Existing trusts would have six months from commencement to file their first return under the new system, after which further returns would follow annually.
The exact information and filing method would still have to be prescribed.
This is significant because trust compliance would increasingly resemble an ongoing regulatory process rather than something dealt with only when a trust is created, amended or terminated.
Beneficial ownership would remain firmly in focus
The Bill also contains detailed provisions dealing with beneficial ownership.
A trustee would have to establish and record the beneficial ownership of the trust, maintain the prescribed information, lodge a beneficial-ownership register with the Master’s Office and update changes within 10 days.
The Master would also maintain a beneficial-ownership register.
Again, trustees should understand the distinction between what is new and what already applies. Beneficial-ownership reporting is already part of current South African trust law following the 2022 amendments. The proposed Bill would carry these transparency requirements into the replacement framework and add further detail around updating and administration.
Beneficial ownership is not simply a tax concept. The measures form part of South Africa’s broader anti-money-laundering and counter-terrorism-financing framework and are intended to make it more difficult to hide the natural persons who ultimately own, control or benefit from legal arrangements.
Trustees could face greater regulatory consequences
Perhaps the clearest indication that trust administration is becoming more formal is the proposed enforcement system.
Under sections 33 and 34, the Master could issue a compliance notice where a trustee fails to meet specified obligations, including filing an annual return or complying with beneficial-ownership requirements. Continued non-compliance could lead to an administrative fine.
Importantly, an administrative fine imposed on a trustee would have to be paid personally by the trustee and could not simply be paid from trust property. The maximum amounts would still have to be prescribed.
Certain offences under the proposed legislation carry much more serious potential consequences. For specified offences involving accountable institutions, trust property and intentionally incorrect beneficial-ownership information, the Bill provides for penalties of up to R10 million, imprisonment for up to five years, or both.
These are proposed penalties in a draft Bill. They should not be described as new law until the legislative process has been completed and the legislation has commenced.
Does the Bill affect existing family trusts?
Potentially, yes.
The Bill contains transitional provisions rather than simply wiping existing trusts from the legal landscape. Existing lawful acts under the old legislation would generally be preserved, while regulations under the Trust Property Control Act could remain in force until amended or repealed.
But an existing trust would not necessarily be able to continue indefinitely using old administrative practices if the new legislation comes into operation.
This makes the Bill relevant not only to people considering forming trusts, but to anyone who is already a trustee.
It may be sensible for trustees to use the proposed reform as an opportunity to ask whether their trust records are genuinely in order: whether the correct trustees are authorised, whether resolutions are properly recorded, whether assets are clearly identified as trust property, whether beneficial-ownership information is current and whether the trust is still being administered according to its deed.
Is the Regulation of Trusts Bill already law?
No.
As at August 2026, it remains a draft Bill published for public comment. Submissions close on 11 September 2026. Even if the Bill proceeds through Parliament, its wording may change before enactment.
The draft itself provides that a future Regulation of Trusts Act, 2026 would commence only on a date determined by the President by proclamation in the Government Gazette.
That distinction matters. Responsible legal commentary should explain proposed legislation without creating the impression that it has already changed people’s legal obligations.
What should trustees do now?
There is no reason for trustees to panic or attempt to comply prematurely with requirements that have not yet become law.
There is, however, every reason to make sure the trust is complying with current law.
The proposed Bill reinforces a broader trend in South African trust regulation: trusts are expected to be properly administered, documented and transparent. The fact that a trust was created primarily for a family does not remove the duties associated with trusteeship.
Conclusion: a trust is not simply a file in a cupboard
A well-designed trust can remain a valuable estate-planning, asset-management or succession tool. But a trust only works properly when the legal structure is respected.
The Regulation of Trusts Bill, 2026 signals an intention to place even greater emphasis on accountability, financial records, beneficial ownership, reporting and the Master’s supervisory powers.
For trustees, founders and beneficiaries, the real lesson is not simply that “trust law is changing”. It is that the era of treating a trust as an informal family arrangement is increasingly difficult to reconcile with modern compliance requirements.
Wessels & Smith Inc assists with trusts, wills, estate planning, estate administration and related legal arrangements. Trustees and families who are uncertain whether an existing trust remains properly structured and administered should obtain advice based on their specific circumstances.
Disclaimer: This article is for general information only and does not constitute legal advice. The Regulation of Trusts Bill, 2026 is draft legislation and may be amended before enactment. Current legal requirements should be assessed separately.
