It’s that time of year again — the countdown to December is ON, and so is the rush to make the most of your Single Discretionary Allowance (SDA). Whether you’re a South African tax resident still living locally or an expat managing funds from abroad, your SDA allowance gives you a valuable opportunity to move money offshore before the annual window closes.
Let’s unpack what this means, how the rules around exchange control allowances work, and why it makes sense to act before 24 December.
Top 3 takeaways on using the Single Discretionary Allowance to move money out of SA:
- You can transfer up to R1 million per year offshore under your Single Discretionary Allowance without prior SARS or SARB approval.
- The SDA is available only to South African tax residents, whether living in South Africa or abroad.
- You can use your SDA allowance for international money transfers, offshore investments, or foreign currency accounts.
Read more: Six things SARS wants you to know about the limits on transferring money out of South Africa.
The Single Discretionary Allowance in South Africa – what it is and how it works
Your Single Discretionary Allowance is part of South Africa’s exchange control regulations, which govern how much money residents can legally transfer out of South Africa.
Each year, South Africans over the age of 18 are permitted to send up to R1 million abroad — without needing prior SARB or SARS approval.
Your Single Discretionary Allowance can be used for:
- Offshore investments
- Travel and overseas expenses
- Foreign currency accounts
- Gifts or loans to non-residents
- Education or medical costs abroad
If you haven’t yet used your discretionary allowance for 2025, now’s the time. Your annual offshore allowance resets on 1 January, meaning you could transfer R1 million now and another R1 million at the start of the new year, without needing to run the full administrative gauntlet that is the SARS AIT process.
Offshore investment from South Africa – using your SDA to invest abroad
If you’re looking to invest offshore from South Africa, the Single Discretionary Allowance is your simplest starting point. You can use your R1 million allowance to:
- Open an offshore investment account
- Purchase foreign shares or unit trusts
- Buy property abroad
- Diversify savings into foreign currency
For those looking to invest more, the Foreign Investment Allowance (FIA) allows transfers of up to R10 million per year, provided you have SARS Approval for International Transfer (AIT).
If you’ve already used your R1 million SDA, you can combine it with your FIA for larger international money transfers from South Africa, all within the framework of SARB exchange control regulations.
Transferring money from South Africa – the step-by-step process
When you transfer money from South Africa under your Single Discretionary Allowance, the process is straightforward but must comply with exchange control regulations.
Here’s what you’ll need to do:
- Use an authorised dealer – Only banks or licensed foreign exchange companies can handle cross-border payments.
- Confirm your tax compliance – Make sure your tax compliance status with SARS is up to date.
- Prepare your documents – Provide your ID, proof of address, and tax number.
- Choose your transfer method – Funds can move via bank-to-bank international transfer or a cross-border money transfer platform.
For amounts under R1 million, no AIT approval is needed, making the SDA the quickest and easiest way to transfer funds abroad before year-end.
Read more: How SARS impacts international money transfers.
Your Tax Compliance Status in SA – what you need to know
Before you can send money overseas from South Africa, you must be tax compliant. Your Tax Compliance Status (TCS) shows that you are up to date with your SARS returns and payments.
You can check your tax compliance status on SARS eFiling by generating a TCS PIN. This PIN is verified by your bank or authorised dealer in foreign exchange before your international transfer is processed.
Ensuring your tax compliance status is valid helps prevent delays and ensures your international money transfer proceeds smoothly.
Read more: Your SARS Tax Compliance Status – what expats need to know.
The Foreign Investment Allowance in South Africa – your next step after the SDA
If you’ve already used your Single Discretionary Allowance, the next option is the Foreign Investment Allowance. This allows you to transfer up to R10 million abroad each year, but you’ll need to apply for SARS Approval for International Transfer (AIT).
The AIT application verifies your tax residency, source of funds, and tax compliance. Once approved, your authorised dealer can process your foreign capital transfer within the SARB exchange control regulations.
Combining your SDA and FIA gives you the flexibility to move up to R11 million offshore annually — ideal for larger offshore investments from South Africa or international diversification.
Read more: AIT: the ultimate guide to the new SARS Tax Compliance Status for South African expats.
Exchange control regulations in South Africa – staying compliant
All cross-border transactions from South Africa are regulated by the South African Reserve Bank (SARB) through its Financial Surveillance Department (FinSurv).
These exchange control regulations are in place to manage capital flows, protect the economy, and ensure that foreign payments are made through authorised and traceable channels.
By working with an authorised dealer and ensuring your SARS TCS PIN is valid, you’ll stay fully compliant while executing international money transfers or offshore investments.
Read more: Don’t let SARS delay your international transfer – essential documents for expats.
Offshore transfer from South Africa – why use your SDA before 31 December
The Single Discretionary Allowance resets every year, so using your R1 million allocation before 31 December is a smart move. Doing so allows you to transfer money offshore twice in quick succession — once now and again in January.
For example, a couple could transfer R4 million collectively across December and January, all without needing SARS AIT approval. It’s a simple, compliant strategy for offshore diversification, currency risk protection, and financial flexibility.
Transfer money out of South Africa easily with FinGlobal
Whether you’re planning to invest offshore, send money overseas, or transfer funds abroad before year-end, FinGlobal can help.
We’ll guide you through verifying your tax compliance status, assist with SARS AIT applications, and handle the exchange control approvals needed for both your SDA and FIA transfers. Make the most of your Single Discretionary Allowance before it resets — and make your next international money transfer from South Africa with confidence.
Get in touch with FinGlobal today for expert assistance managing your cross-border transactions.
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