Financial Emigration: Cost to financially emigrate from South Africa

Financial emigration is a big step. Like all of life’s big decisions, you’re going to want to think carefully about whether or not financial emigration is your best move. To ensure you’re making the right decision for the right reasons, it pays to know exactly what’s involved in financial emigration, and how much you’re looking at from a cost perspective. While financial emigration is not a simple, quick process, nor an inexpensive one, you can make it as pain-free as possible and keep costs to a minimum by choosing the right financial emigration partner.

Let’s take a look at what you need to know about formalising your emigration, including the costs of financially emigrating from South Africa.

 

What is financial emigration?

Financial emigration is the process through which South African expats (now living abroad) can notify the South African Reserve Bank of their change in status from “resident” to “non-resident”, by placing their emigration on record.

This change in status means that the Reserve Bank will no longer be able to treat you as a resident for exchange control purposes and will impact the manner and amount of money you are allowed to move offshore.

 

What is financial emigration NOT?

Financial emigration does not mean:

• The end of your South African citizenship: once a South African, always a South African.
• Giving up your South African passport: As long as you’re a South African citizen, you’ll hold onto your Green Mamba.
• You can avoid paying expat tax: the only way to do this is by exiting the South African tax system.

 

When should you consider financial emigration?

Logistically speaking, you can’t emigrate financially from South Africa without having physically left the country first. As a result, it usually takes place retrospectively because most South Africans leave without recording their financial emigration at the time of their physical emigration from South Africa.

This means that you can still apply for financial emigration after the fact, even if you left South Africa many years ago.

 

What are the benefits of financial emigration?

There’s no point in doing something that doesn’t have big benefits for you, right? Of course. Here, you’ll have to weigh the benefits against the costs of financial emigration from South Africa in order to make your decision.

Once you’ve completed the process of financial emigration, the Reserve Bank is obliged to apply non-resident exchange control rules to any cross-border financial transactions you wish to make.

• It’s easier for you to transfer capital and income out of South Africa, which means you can shift your savings out of South Africa in order to protect them from global currency volatility.
• You become eligible to access and cash in the proceeds of your retirement annuities before retirement, which you can then easily move offshore.
• It’s easier to transfer abroad any  South African source inheritance, as well as your passive income (like rental or director’s fees) and the proceeds of assets declared in your emigration application.
• In addition, income from a discretionary or vesting trust may also under specific circumstances be transferred abroad from South Africa.

 

Important considerations in weighing up costs of financial emigration from South Africa
Researching the costs of financial emigration from South Africa? Don’t forget that:

• Before recording your financial emigration from South Africa, you will need to ensure that your affairs are in good standing with the South African Revenue Service (SARS). You will need a tax clearance certificate from SARS to verify that you are up to date.
• After your financial emigration has been completed, your South African bank account will be re-assigned for exchange control purposes as an emigrant’s capital account (previously called a blocked account) and subject to exchange control rules in South Africa.
• The bank that holds your emigrant’s capital account will administer your remaining South African-based assets according to local exchange control rules.

 

Some of the disadvantages of financial emigration include:

• You will no longer be permitted to hold a South African credit card, or avail of credit facilities.
• You will trigger a Capital Gains Liability when your financial emigration is formalised, which means you are deemed to have sold your assets the day prior to your emigration.

 

How much does it cost to financially emigrate from South Africa?

Your financial emigration requirements are unique. No two journeys are the same, which is why FinGlobal goes the extra mile to tailor your process to satisfy your specific needs, while keeping your financial emigration costs in check.

We’re here to ensure that there are no unpleasant surprises, and that you’re completely prepared financially for every step you make. For that reason, our financial migration experts offer impartial guidance, providing clarity on your ideal roadmap to the next chapter of your future.

 

We believe that FinGlobal is the right financial emigration partner for South Africans worldwide because we promise:

• Fair value and transparent fees: delivered by means of bespoke cross-border financial solutions that perform as expected.
• Predictable, fixed costs for specific services: to avoid the uncertainty of percentage-based fees that vary in line with the transaction amount.  
• A personalised, one-on-one assessment: we get to know your specific requirements and ultimate objectives, so we can tailor your financial emigration solution.
• Payment on successful completion of service only:  which means we’ll do everything in our power to ensure you’re satisfied.

Handling your financial emigration this way is the smart way. Where costs are clear and agreed upfront, and our payment depends on the outcome, you can rest assured that everything will happen as it should without you needing to chase or follow up.

Why should you choose FinGlobal as your financial emigration services partner? Because when you ask us: “how much does it cost to financially emigrate from South Africa?” we can give you a detailed, clear-cut answer that doesn’t vary depending on who you speak to.

Furthermore, we offer a full suite of financial services that are fully compliant, including:

• Financial emigration
• Tax emigration
• Tax refunds
• Tax clearance
• Foreign exchange

What are you waiting for? Contact us today so we can talk about financial emigration from South Africa.