Regulation of Trusts Bill, 2026: What Trustees and Beneficiaries Need to Know

South Africa’s law governing trusts may soon undergo its most significant overhaul in decades. The Regulation of Trusts Bill, 2026 (“the Bill”) proposes to repeal and replace the Trust Property Control Act 57 of 1988, introducing a considerably more detailed regulatory framework for the creation, administration and oversight of trusts.

Cabinet approved the Bill for publication for public comment on 29 July 2026, describing its objectives as modernising the law of trusts, strengthening accountability and compliance, enhancing the oversight role of the Master of the High Court, and providing greater protection to beneficiaries.

Importantly, the Bill is not yet law. It was published for public comment on 7 August 2026, and interested parties currently have until Friday, 11 September 2026 to submit written comments to the Department of Justice and Constitutional Development.

There is therefore no fixed date on which the proposed changes will take effect. The Bill must still proceed through the legislative process and may be amended before it is enacted. As presently drafted, the eventual Regulation of Trusts Act will come into operation on a date determined by the President by proclamation in the Government Gazette.

Why is the law changing?

The present Trust Property Control Act was enacted in 1988 and has not undergone a comprehensive review during the intervening decades. According to the Department of Justice and Constitutional Development, the Bill is intended, amongst other things, to address weaknesses in the existing framework relating to trustee accountability, the Master's ability to exercise effective oversight, the protection of beneficiaries and transparency regarding the control of trust property. It is also intended to better align South Africa's trust regime with Financial Action Task Force (“FATF”) requirements concerning money laundering and related financial crime risks.

The Bill seeks to consolidate and strengthen an already increasingly compliance-driven trust regulatory environment, while introducing additional reporting, enforcement and oversight mechanisms.

What are the most important proposed changes?

More formal requirements for creating a valid trust:

The Bill expressly provides that a trust is created where the founder, clearly and with reasonable certainty, indicates an intention to create a trust, identifies the trust property, identifies the beneficiaries or classes of beneficiaries (or the object of the trust), and appoints a trustee or provides for the appointment of one. The object must be lawful, and a sole trustee may not simultaneously be the sole beneficiary. A court may declare a trust invalid where these requirements are not satisfied.

The Bill places these requirements expressly on a statutory footing and provides specific consequences where they are not met.

Greater powers for the Master of the High Court:

The Bill retains and expands the Master's supervisory role. The Master already has powers under the existing framework to require trustees to account and to produce records and documents, but the Bill introduces a more detailed statutory framework governing oversight, investigations, compliance and enforcement.

The Bill also regulates the appointment of additional trustees in greater detail. In particular, where all trustees are beneficiaries, all trustees are related to one another, and the trust conducts business or trading activities with third parties, the Master may appoint an independent trustee where this is considered necessary to ensure the separation of control and enjoyment of trust property.

The effectiveness of these expanded powers will, however, depend substantially on the administrative capacity of the Master's Offices. Additional regulatory responsibilities may improve oversight in principle, but without corresponding improvements in systems, staffing and turnaround times there is a risk that the Bill increases the compliance burden on trustees without producing an equivalent improvement in administration or enforcement.

Trustee authorisation and disqualification:

The Bill retains the existing principle that a trustee may not act without written authorisation from the Master, while setting out a more detailed statutory framework governing trustee authorisation and disqualification. It identifies categories of persons who may be disqualified from acting as trustees and continues the framework for a public register of persons disqualified from being authorised to act as trustees.

Annual financial statements and annual returns:

One of the Bill's more significant practical changes is the formalisation of financial reporting under trust legislation itself and the introduction of an annual return to the Master.

The Bill expressly requires trustees to cause annual financial statements to be prepared, subject to an exemption where the trust falls below thresholds to be determined by the Minister and the trust instrument does not itself require financial statements. Although the present Trust Property Control Act does not impose an equivalent general statutory obligation, many trusts already prepare annual financial statements or annual administration accounts in order to comply with their trust deeds, accounting requirements and SARS obligations.

In addition, trustees will be required to file a prescribed annual return with the Master and pay the prescribed fee. This return is separate from the trust's existing annual income-tax return to SARS and will therefore constitute an additional regulatory filing. Existing trusts will be required to file their first annual return within six months after commencement of the Act.

Further formalisation of beneficial ownership requirements:

Beneficial-ownership disclosure is not new. Trustees are already required to establish, record and lodge beneficial-ownership information with the Master. The Bill retains these obligations, adopts a broad definition of “beneficial owner” and requires changes to be recorded and lodged within 10 days.

More detailed statutory record-keeping requirements:

The Bill sets trustees' existing record-keeping duties out in greater detail and requires specified records to be retained throughout the trusteeship and for five years thereafter. These include the trust instrument and amendments, financial and accounting records, trustee resolutions, contracts and records relating to trust property and the appointment or removal of trustees.

Clear separation of trust property:

The Bill retains and restates the existing principle that trust property must be kept separate from a trustee's personal estate and must be clearly identified as trust property. It also continues the requirement that money received in a trustee's capacity as trustee be held in a separate account in the name of the trust.

The Bill also provides a more detailed statutory framework for trustee investment decisions, including a prudent-investor standard and prescribed considerations relevant to investment decisions. It also consolidates existing requirements relating to dealings with accountable institutions.

Compliance notices and personal administrative fines:

One of the clearest practical changes introduced by the Bill is its structured administrative enforcement regime.

The Master may issue a compliance notice where a trustee fails, amongst other things, to provide required contact details, account to the Master, submit requested financial statements, file an annual return or comply with beneficial-ownership requirements. Failure to remedy the non-compliance may then result in an administrative fine. This creates a distinct compliance-notice and administrative-fine mechanism within the new statutory framework.

Crucially, an administrative fine imposed on a trustee must be paid personally by that trustee and may not be recovered from trust property.

Significant criminal penalties:

The Bill also retains severe criminal sanctions for certain contraventions, including fines of up to R10 million and imprisonment for up to five years in specified cases. Similar penalties already exist under the current Act, but the Bill combines criminal sanctions with the new compliance-notice and administrative-fine regime.

What does the Bill mean for existing trusts?

Existing trustees should review their trust deeds, governance procedures, financial records and beneficial-ownership information in preparation for the proposed annual return, financial-reporting requirements, shorter beneficial-ownership updating periods and new administrative enforcement regime.

Will the Bill create additional red tape?

Inevitably, yes. The Bill introduces additional filings, prescribed fees, shorter compliance periods and a new administrative enforcement regime. This is particularly significant because trusts already provide substantial information to SARS, the Master's Office and financial institutions. The proposed annual return to the Master therefore raises a legitimate question whether better information-sharing between State institutions could achieve some of the same objectives without duplicating compliance obligations.

There is also a question of proportionality. Large trading trusts and comparatively simple family trusts do not necessarily present the same regulatory risks. A more risk-based approach may better balance transparency and accountability against the cost of compliance.

Much will still depend on the regulations

Certain details of the proposed regime remain to be prescribed by regulation, including the form of annual returns and applicable fees, the thresholds for exemptions from annual financial statements, and the maximum administrative fines.

A significant change in the regulation of South African trusts

The Bill is best understood as a consolidation and expansion of South Africa's existing trust regulatory framework. While many provisions restate or formalise existing obligations, the annual return to the Master, administrative-fine regime and more prescriptive compliance requirements will create additional obligations.

Greater transparency and trustee accountability are legitimate objectives. The real test will be whether the additional regulation results in better governance and enforcement rather than simply more administration — particularly given that the effectiveness of the new regime will depend heavily on the capacity of the Master's Offices.

The Bill remains open for public comment until 11 September 2026, and its provisions may still change before becoming law.

Le Roux Vivier Attorneys assists individuals, families and businesses with the creation and registration of trusts, the drafting and amendment of trust deeds, trust administration and compliance, estate and succession planning, and trust-related disputes.

This article is intended for general information purposes only and does not constitute legal advice. The Regulation of Trusts Bill, 2026 remains draft legislation and may be amended during the legislative process. The position stated is current as at 10 September 2026.

Fraser Stockley

BCom Law; LLB

Partner at Le Roux Vivier Attorneys

Disclaimer: The views expressed in this article are those of the author(s) and do not necessarily reflect the views of the firm. This content is provided for general information only and does not constitute legal advice. While every effort is made to ensure accuracy, the law may change and its application depends on the specific facts of each matter. Readers should seek professional legal advice before acting on any information contained herein. The firm and the author(s) accept no liability for any loss or damage arising from reliance on this content.