If you’re looking to relocate your life and family abroad, or just your money, it’s a good idea to know exactly how much money you can take out of South Africa, and how you need to do it. Moving money across South African borders has an exchange control impact. You will need to be aware of the exchange control limits and methods of transferring funds abroad using either the Foreign Capital Allowance (formally known as Foreign Investment Allowance/ FIA) or Single Discretionary Allowance.
Money: the Reserve Bank’s business
All foreign exchange transactions from South Africa are subject to the exchange control regulations that are administered by the South African Reserve Bank (SARB). Because it can amount to a criminal offense if you are found to be in contravention of exchange control regulations, do your research carefully.
What is the South African Foreign Capital Allowance (FIA)?
It is an annual allowance of R10 million available to South African residents, South African residents temporarily abroad and emigrants.
- You must be 18 years or older.
- A Tax Clearance Certificate must be obtained from SARS (South African Revenue Service).
- Green bar-coded ID document or a Smart ID card.
What is the Single Discretionary Allowance (SDA)?
This allowance enables a person per calendar year to transfer R1 million out of South Africa. This mechanism is open to South African residents and residents temporarily abroad.
- You must be 18 years or older.
- Have a green bar-coded ID document or a Smart ID card.
- In this instance, no tax clearance certificate is required.
What is the Special Allowance?
If you wish to transfer an amount offshore in excess of the annual foreign capital allowance, as a South African resident (or resident temporarily abroad) you are able to make use of the Special Allowance. The amount that you can transfer under this allowance has no limit but will require approval from SARB and must adhere to the transfer requirements as outlined above.
What is the limit in South African banknotes you are allowed to carry when leaving?
- You can declare and carry a maximum of R25 000 in rand notes when leaving.
- South African bank notes are unlimited if you are going to / coming from a country within the Common Monetary Area (CMA), i.e.: Lesotho, Swaziland.
Not in South Africa anymore, but also looking to get your money out?
If you are already living and working abroad, it can be a bit more challenging transferring some of your South African based income. By financially emigrating, you will be able to transfer your South African based capital abroad.
As a financial emigrant you’ll be able to transfer out of South Africa:
- The proceeds of your retirement annuity, even before age 55.
- Your South African source inheritance.
- The proceeds of assets declared in your emigration application.
- Passive income such as rent, dividends, director’s fees, salary for services rendered in South Africa and income from discretionary or vesting trusts in certain circumstances.
FinGlobal: The Expat’s Choice in Cross Border Financial Services
The decision to start the process of financial emigration is, of course, a highly personal one that will depend entirely on your individual circumstances, but it’s not a decision you’ll never have to face alone. We are financial emigration experts – fluent in tax, exchange control, financial legalities – there to help you every step of the way. Whether you’re just looking to move your money abroad using the foreign capital allowance (FIA), or you want to formalise your financial emigration and start a fresh life abroad in your new home country, we can give you the best advice when it comes to moving your money. Sound good? Let us call you.
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