Wind Up Wind Down

Understanding the tax implications during sequestration in South Africa is an important part of the insolvency process. Sequestration affects more than your assets and debts — it also changes how the South African Revenue Service (SARS) administers your tax affairs. This includes your tax status, outstanding tax debt, income tax and, in certain circumstances, Capital Gains Tax (CGT). Here is what you need to know.

Worried about losing your house or car during sequestration? We explain what happens to financed assets, outstanding balances and shortfalls, and how these assets can form part of resolving your debt.

Many South Africans who struggle with overwhelming debt often wonder if they should choose sequestration over debt review. Both processes offer legal protection, but they serve very different financial realities. If you face severe financial distress and see no realistic way to repay what you owe, sequestration may offer a more decisive and practical solution than debt review. Let’s understand why sequestration can be a better option than debt review in South Africa.