The Expat’s Guide to: Moving Money Out of South Africa (2024)

FAQs

The Expat’s Guide to: Moving Money Out of South Africa? ›

You will need a “Tax Clearance Certificate – Foreign Investment Allowance” that is duly completed and electronically issued by the South African Revenue Service (SARS) before funds can be transferred in terms of your FIA. You must be older than 18 years of age and in good standing with SARS.

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.

How much money can I transfer out of South Africa? South Africa has strict foreign exchange controls that allow the South African Reserve Bank to keep track of the outflow and inflow of capital in South Africa. You can transfer a total of R11 million a year using your allowances.

Every South African has a single discretionary allowance (SDA) of up to R1m, which can be sent offshore, per calendar year (January to December). No tax clearance certificate is necessary when externalising funds via your SDA. It is as simple as instructing your bank to send the funds abroad.

The R10 million limit may be increased following a more complex SARB and SARS process. For non-residents: Remaining R100,000 cash: Non-residents, having ceased tax residency, can remit the remaining cash balance, up to R100,000, abroad on a once-off basis without SARS approval.

The South African Reserve Bank has made provision for a gift allowance that can be used by residents to send up to R1,000,000 overseas as a gift. However, any amounts that exceed R100,000 become taxable at a rate of 20%.

Any international money transfer exceeding $10,000 USD must be reported to the US government on a Foreign Bank Account Report per the Bank Secrecy Act. Many people wonder, “Do large bank transfers take longer than online services?” Typically, the answer is yes.

Until you have formally (or financially) emigrated, your status will be as a South African tax resident temporarily abroad, and you will not be permitted to withdraw your South African retirement funds out of the country.

Once you are no longer considered a tax resident in South Africa, your tax liability only applies to South African-sourced income and assets, as opposed to worldwide income and assets.

Exit tax when you leave South Africa

In South Africa, CGT is not a flat rate. A portion gets added to your other income for that tax year and you're taxed in your tax bracket. The CGT rate can range from 7.2% to 18% depending on the tax bracket you're in.

Is it hard to get money out of South Africa? ›

The first point to note is that transferring money out of South Africa is not that simple. number of requirements that must be fulfilled depending upon your reason for transferring money out of South Africa. Appropriate tax clearance must be obtained. Declarations of adherence to allowances.

Bank transfers are often the default option for sending money from South Africa to United States. By using a money transfer company such as Regency FX for transfers from South Africa to United States, you can send money via a bank transfer while benefitting from lower fees and more favorable exchange rates.

Send money via EFT into any bank account in the United States. Your recipient can collect the money from their bank account in the USA. Mukuru offers convenient ways to send money home, including cash collection, bank, mobile wallet, or cash-to-bank top-up.

THE NEW LEGISLATION STATES:

The amendment requires South African tax residents abroad to pay South African tax of up to 45% of their foreign employment income which exceeds the threshold of R1. 25 million.

You qualify as a South African tax resident. You perform employment services outside South Africa on behalf of an employer (it does not matter if the employer is South African or foreign) You spend at least 183 full days physically outside of the borders of South Africa in any 12-month period.

South Africa has a residence-based tax system, which means residents are, subject to certain exclusions, taxed on their worldwide income, irrespective of where their income was earned. By contrast, non-residents are taxed on their income from a South African source.

Moving abroad does not wipe your debts or relieve you of the obligation to settle the debts you left behind. Furthermore, moving overseas does not mean that your creditors will stop hounding you for payment. As long as the debt you owe remains, you will be liable in South Africa.

To be designated an emigrant for exchange control purposes (in other words, if you want to leave South Africa to settle in another country permanently), you must follow the excon process as defined by SARB. This is also known as 'financial emigration'.

SARS will verify your bank account before accepting changes to your banking details.

Bank transfers are often the default option for sending money from South Africa to United States. By using a money transfer company such as Regency FX for transfers from South Africa to United States, you can send money via a bank transfer while benefitting from lower fees and more favorable exchange rates.