What do expats need to know about South African retirement annuity fund rules?
When it comes to saving for your retirement, the golden rule is to treat as untouchable those funds that you accumulate for your so-called golden years. So much so, that the law even enforces this golden rule by preventing South Africans from accessing their retirement savings before the age of 55. Every rule has exceptions, however, and the exception to this particular rule comes in once you’ve left the motherland.
What is financial emigration?
Financial emigration isn’t as daunting as it sounds. It’s simply the process by which you will, as a South African resident, exit the country financially from an exchange control point of view.
- The proceeds of your retirement annuity, even before maturity date
- Your South African source inheritance and the proceeds from any third party life policy to which you are a beneficiary
- The proceeds of assets and wealth declared to SARB in your emigration application
- Any passive income you earn (rental income, company dividends, directors’ fees or salary for services rendered in SA, as well as trust income).
What can South African expats do with their retirement annuities?
South Africans living abroad can turn their retirement annuities into cash and transfer these funds to their new home. The best part about transferring the proceeds from cashing in your South African retirement annuity is the fact that once it’s done, it’s your money.
How do I go about cashing in my South African retirement annuity?
To gain access to the funds you’ve saved for retirement, you need to undertake retirement annuity surrender which requires financial emigration. However, this is not as simple as it sounds.
- The surrender of retirement annuities, preservation funds and similar pension products
- The acquisition and submission of claims or other administrative documents to insurers, SARS, SARB and banking institutions
- Tax refunds and exemptions relative to the surrender of certain policies
- The surrender of other insurance products with an investment value
- Full financial emigration service with transfer of retirement annuity funds offshore before age 55.
What’s the first step in transferring a South African retirement annuity abroad?
Simply make the first move by getting in touch with us to discuss how we can help make your financial transition easier and leave the rest in our capable hands. Why? Because we’ve already done it for more than 60 000 clients living in 105 countries with our end-to-end expat financial services and we’d love to give you the same convenient experience.