BUDGET SPEECH: SARB INCREASES ANNUAL ALLOWANCES!

[BronPreston]

Budget Speech Breaking News: SARB increases annual Foreign Investment Allowance to R10 Million

The South African Reserve Bank has announced the following increases to private client limits with effect from 1 April 2015:

- FOREIGN INVESTMENT ALLOWANCE

South African residents foreign investment allowances will increase from R4 Million to R10 Million per calendar year

- DISCRETIONARY ALLOWANCE

The sub-categories under the annual R1 Million discretionary allowance will be removed and South African residents will be able to send up to R1M per calendar year out of the country for any legal purpose abroad.

- EMIGRATION

Emigration allowances increased from R8 Million to R20 Million

[Shampoo]

Don't believe agencies that insist that you Formally Emigrate to get your pension or RA money out. You can get it transferred out without paying big bucks for this. No need to Formally Emigrate.

You can transfer it without tax depending on the wording of your DTA.

Edited February 26, 2015 by Shampoo

[Tiermelk]

Hi Shampoo, how would you get your RA`s out without formally emigrating?

Thanks!

[GarethDavies]

I would Chat to a a top financial planning and or accounting firm in South Africa. They can consolidate all your Financial Statements and give advice around your tax obligations and general options depending on your age and available funds.If you are in Australia, there are a few firms that can assist you this side to.

[Heymanse]

Don't believe agencies that insist that you Formally Emigrate to get your pension or RA money out. You can get it transferred out without paying big bucks for this. No need to Formally Emigrate.

You can transfer it without tax depending on the wording of your DTA.

There is however the need to formally emigrate, especially if you stand the change of being a beneficiary in someone's Last Will & Testament. No funds will be transferred to an overseas bank account if the Authorised Dealer (bank) cannot determine that you have formally emigrated from South Africa and this formal emigration will be recorded with the South African Reserve Bank.

If your money matters are pretty straight forward, I would agree that there is no need to pay an agency fees to get your money out. We did everything ourselves and it was really not too difficult to do. The bank (Standard) was really helpful and guided as step by step and the formal emigration was done in just over 2 weeks. (Just as a note - we did formally emigrate before leaving South Africa which made the visit to SARS and the bank very easy)

Edited March 23, 2015 by Heymanse

[GarethDavies]

Hi Heymanse,

If you have a South African bank account, ( I do both Absa and Investec ), I take it that inheritances will then be paid to Your South African bank account? You could then after receiving the money, transfer your funds overseas with the 10 mill allowance per person per year? Please let me know if i am missing something here? I agree that if you no longer have any Bank Accounts in South Africa and have not formally immigrated, you will not get paid the inheritance money! You would then need to fly back and open an account to receive the funds and or Formally immigrate. It depends on your circumstances and there should be different solutions for different circumstances.

Edited March 23, 2015 by GarethDavies

[Heymanse]

Hi GarethDavies,

Actually, you do not have to have a South African bank account in order for inheritances to be transferred to an overseas bank account. If you have formally emigrated, funds should be transferred from a South African bank account (of the estate) to an overseas bank account. I used to work at the Exchange Control Department at the South African Reserve Bank for 18 years before emigrating to Australia and wanted to close my South African blocked rand accounts but wanted to know what, if any, effect that would have on future inheritance payouts. I have received this information first hand from one of the managers I used to work with and it is also stipulated in the Regulations. I'll see if I can find it again and put the link up. I know someone recently posted that they had to open a bank account in South Africa again in order for ABSA to transfer the inheritance to an overseas bank account. I do not know what the circumstances were in which they emigrated and whether they formally emigrated and that could possibly have been the reason why ABSA didn't want to do the transfer. According to the South African Reserve Bank Regulations, the funds should and could be transferred if all appropriate steps had been taken with regards to formal emigration. I closed my blocked Rand account in 2012.

Herewith, the link to the Regulations - please refer to the third paragraph:

"Where the beneficiary is an emigrant, it would be incumbent upon Authorised Dealers to ensure that the emigrant has been formally redesignated as a non- resident, before effecting transfers in terms of the aforegoing. Where no such record can be established, the matter must be referred to the Financial Surveillance Department."

https://www.resbank.co.za/RegulationAndSupervision/FinancialSurveillanceAndExchangeControl/EXCMan/Section%20M/Section%20M.pdf

Very helpful is this link as well:

https://www.resbank.co.za/RegulationAndSupervision/FinancialSurveillanceAndExchangeControl/FAQs/Pages/Emigrants.aspx

Edited March 23, 2015 by Heymanse

[GarethDavies]

Thanks Heymanse,

I think there are a lot of people with similar questions. I have been in Australia for 2 years now and am enjoying it very much! All the best! Gareth

[TanyaVDWesthuizen]

Hi guys,

Just for clarity, in order to get your RA funds paid out before retirement, you need to go through the formal (financial) emigration process, no other way around it.

Please feel free to contact me with any excon and Foreign exchange transfer questions