Estate duty applies only to the beneficial interest passing on death, not the entire trust estate.

Estate duty under section 5(1) of the Estate Duty Act turns on the property that actually passes on death, read with the inclusive definitions in sections 2(15) and 2(16). The relevant inquiry is whether there is a change in beneficial interest, not merely a change in legal title. A trustee-beneficiary with a one-third beneficial interest in trust income held no proprietary value in the office of trustee, only duties. On death, only that one-third beneficial interest passed; the remaining trust estate did not form part of the property passing for estate duty.

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Issues: Whether, on the death of a trustee-beneficiary, the whole of the trust estate passed for estate duty purposes or only the deceased's one-third beneficial interest in the trust income.

Analysis: The scope of section 5(1) of the Estate Duty Act depends on what property actually passes on death, read with the inclusive definitions in sections 2(15) and 2(16). The relevant enquiry is not the mere change in legal title, but whether there is a change in the beneficial interest immediately before and after death. The deceased had a beneficial right only to one-third of the income under the trust deed, while the remaining two-thirds had already vested beneficially in others. Her role as trustee conferred no proprietary interest of monetary value, but only duties. On death, therefore, only the one-third beneficial interest changed hands, while the legal vesting of trust property in beneficiaries did not enlarge the property that passed.

Conclusion: Only the deceased's one-third beneficial interest in the trust property passed on death, not the entire trust estate; the inclusion of the whole trust estate in the estate duty assessment was not justified.

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