If you’ve been living overseas for some time now, you’re probably thinking about financial emigration. Maybe you’re still in the planning stages of moving abroad, and you’re doing your research, so you know what to expect when the time comes. Either way, financial emigration is not for the faint of heart. With many official entities involved – including the South African Reserve Bank (SARB) and the South African Revenue Service (SARS), your insurance provider(s) and your commercial bank of choice, such as FNB – there is a lot to coordinate, many administrative hoops to be jumped through and a mountain of paperwork to be completed when it comes to financial emigration.
Thankfully there are ways and means to minimise the stress of financial emigration and the more you know, the better you can prepare yourself. Let’s take a quick look at how to financially emigrate if you bank with FNB, including an overview of the procedures involved.
What is financial emigration and why would you want to do it?
Financial emigration makes a lot of sense when you think about it in relation to physical relocation. Once you’ve left South Africa and moved abroad, it’s only logical that you would want to wrap up your financial affairs back in South Africa and move your money to meet your needs in your new home country.
Financial emigration (also known as “formal” emigration) is the international movement of your financial affairs. It is simply the official process by which you make your declaration to the South African Reserve Bank that you are exiting the country, and they should change your status from “resident” to “non-resident” for exchange control purposes. In other words, financial emigration tells the Reserve Bank that they should no longer apply the same exchange controls to you and your money, because you’re no longer a resident for exchange control purposes.
In other words, financial emigration is purely an exchange control matter. It does not affect your citizenship, nor does it affect your tax residency. You’re simply instructing the Reserve Bank to view your money moves differently while you’re living abroad.
Are there benefits to financial emigration? What’s the drawcard?
Once you’ve emigrated financially and become a non-resident for exchange control purposes, you create a free flow of capital out of South Africa and using your non-resident bank account becomes the conduit to move your funds to where you need them. You’ll also unlock a variety of other perks as a financial emigrant, including the ability to move offshore:
- The proceeds of your South African retirement annuity less tax, even before you reach official retirement age.
- The proceeds of assets declared in your emigration application and any South African source inheritance.
- The passive income you receive, such as rent, dividends, director’s fees, salaries for services rendered in SA plus income from discretionary or vesting trusts.
- The beneficiary proceeds from a third-party life policy.
As a financial emigrant and non-resident, all of your assets and capital will come together in one location. If you’re an FNB customer, this is your non-resident bank account, and this will be managed on your behalf by a financial emigration specialist.
Want to learn more about the step-by-step process of opening a non-resident Capital Account? Read here.
FinGlobal: Choose the financial emigration experts
It has been our priority since 2009 to give South Africans the expert advice they need to make important financial decisions. We have successfully helped more than 60 000 clients across the globe with various aspects of their cross-border financial portfolios, and we’re ready to continue that impressive track record with you.
Whether you need our assistance with financial emigration, retirement annuity withdrawal, tax clearance, exiting the South African tax system or foreign exchange, FinGlobal’s team of experts is waiting to walk you through every process, from start to finish.
Choosing to work with the experts on your financial emigration is a smart idea because:
- You won’t have to deal with any of the bureaucratic red tape yourself. We do all the paperwork and check it for you. All you have to do is approve and sign.
- You’ll have your money faster. We can have all the right relationships with all the right people to move the process along as quickly as possible.
- We’ve got all the necessary experts under one roof. Whether tax, exchange control, financial planning or legal, our experts are at your disposal.
- We offer competitive rates and fees are fixed and transparent. You’ll always know what it’s going to cost you, before you sign. No ugly surprises!
- It’s our job to take the stress out of financial emigration for you. You have enough on your plate as it is. When we handle your financial emigration, you’ll be able to track it every step of the way using a convenient online dashboard.
Ready to discuss financial emigration and all the finer details of becoming a non-resident for exchange control purposes? Drop us your details and we’ll call you back.