One of the most important aspects of planning for your international relocation is laying the groundwork to move your money out of South Africa. Although exchange control regulations have eased over the past few years, there are still limits as to how much money you can take out of South Africa when you emigrate, and after you cease tax residency so it’s always advisable to err on the side of caution and be thoroughly prepared for what’s coming. In short, it pays to have a Financial Emigration Plan™ in place to ensure a seamless, stress-free transition so that you’re not left stranded without money in a foreign country.
How much money can you leave South Africa with?
When you physically leave the country, you are allowed to declare and carry a maximum of R25 000 in cash on your person, or an unlimited amount of foreign currency per person. If you are leaving for a country within the Common Monetary Area, the amount of cash you are allowed to take on your person is unlimited. You are permitted to export your personal belongings to the value of R1 million after declaring as such to the South African Revenue Service (SARS).
How much money can you take out of South Africa per year?
South African individuals have two exchange control allowances available to them to use on an annual basis to transfer money out of the country.
- The Single Discretionary Allowance – of up to R1 million per year, no prior tax clearance necessary.
- The Foreign Capital/Investment Allowance – of up to R10 million per year, which is done through SARS by means of the Approval of International Transfers (AIT) clearance process.
As long as you remain a South African tax resident you can use both allowances together to transfer up to R11 million out of the country per year. Once you have ceased tax residency (the final step in your permanent emigration) you will be permitted to transfer up to R1 million overseas as a travel allowance in the same year that you ceased residency, without needing a TCS PIN beforehand. However, it is important to note that this is a one-time allowance that cannot be used again. Furthermore, once you become a non-resident for tax purposes, you no longer qualify to use the Single Discretionary Allowance and all offshore transfers must be done by means of the AIT process.
Transferring money overseas from South Africa
While you are still a tax resident, you can make use of the Single Discretionary Allowance to transfer money out of South Africa, up to R1 million per year without tax clearance from SARS. All you need to use this exchange control allowance is your valid South African identity document (green bar-coded South African identity document or a Smart ID card) which must be presented to the Authorised Dealer handling your international transfer for FinSurv Reporting compliance purposes.
The process to use the Foreign Investment/Capital Allowance was updated by SARS earlier this year. What used to involve applying for a Tax Compliance Status (TCS) PIN in respect of “Foreign Investment Allowance” in order to move money out of South Africa has now been replaced with an Approval for International Transfer” (AIT) application.
- Top tip: you will need a Non-Resident Bank Account in South Africa in order to move money out of the country. FinGlobal can help with this.
How to move money out of South Africa if you are a non-resident
If you are a South African who has previously completed financial emigration through the South African Reserve Bank before March 2021, or you ceased to be a tax resident through SARS thereafter, you will need to supply your Non-Resident Confirmation Letter from SARS when seeking approval for an international transfer to move money out of South Africa. As long as you can verify the legitimacy of the source of your funds, there is no limit to the amount of money you can move out of South Africa as a non-resident. However, where the amount exceeds the Foreign Capital Allowance of R10 million, you will require prior approval from the South African Reserve Bank.
What is the best way to transfer money out of South Africa?
You might be tempted to think that using your bank to move your money overseas is the best way to handle your financial migration. This isn’t always the case.
- Take a look at these top tips for international money transfers: How to choose the best FOREX provider.
FinGlobal: cross-border financial specialists for South Africans abroad
If you’re looking for a reliable, trustworthy financial services provider to manage your emigration financial planning, FinGlobal can assist. We are here to support you in transferring your funds out of South Africa, safely and cost-effectively. We can handle various aspects of your financial relocation, including tax clearance, South African retirement annuity withdrawal, tax emigration, and foreign exchange.
If you’d like to put our convenient services to the test, please share your contact information with us, and we’ll reach out to you shortly!