Financial Emigration cost

[origincanada]

Hi all. Just wanted to get some thoughts around the cost of this process when a company basically drives the process. Reason I ask is I got a quote for this process to be done for myself and my wife. R32 000 was the quote. I thought this was pretty steep. Anybody have any recommendations would be much appreciated. PS the company I got the quote from I have used before for something else and I would rate their service as excellent which is why I got my quote from them.

Thanks

Clinton

[Jasper]

Unfortunately I can't help in the slightest, I'm probably about to go down the same road and was going to get quotes from CashKows - although if it's in the realm of R32 000... I'd rather just skip it! Even with a conversion rate, I could surely have better options for that manner.

I understand there are tax implications, and various others though so I'd be very interested to hear a learned opinion.

[FairGo]

I have removed post about cost of agent as they quote each client accordingly and our circumstance may be different from someone else's.

Apologies for misunderstanding about the topic.

Edited April 13, 2015 by MelJ

[Jordy]

We are paying over R90k for the same visa. And that is just the agent fee. The skills assessment and visa government costs we pay directly.

The reason why we chose them is because if we do not succeed in getting an Australian visa, they will also do a New Zealand application for us.

I assume the original poster is speaking about Financial emigration ie Formal Emigration (as per topic heading) and not Migration agents.

I thought the figure for someone like Exchange4Free to do it was about R9500?

[jenksinoz]

This is a well timed post for us. We have just had a quote form Cashkows and our total fees come to over R40000. We have also done some investigation into exchange 4free and found that they charge R9500 for the entire financial emigration process. ... but this doesn't include any tax returns that need to be submitted (of which there are 2x 6 years worth of tax returns to do), nor does it include any courier fees we may incur. If we assume that these fees will be the same as per the Cashkows quote, Exchange4free still come out less expensive!

Does anyone know what other costs might be hidden? We have a Skype conversation scheduled with the Cashkows agent on Friday.

Has anyone had first hand experience of Exchange4free with regards to the financial emigration process?

Any advice or recommendations would be welcome at this stage.

Thanks

Edited April 14, 2015 by jenksinoz

[followmylead]

We are in the process right now and we are paying 32k. But judging by all the forms etc we needed to do it seems worth it. So far their service has been exemplary. And payment is only once the money comes through.

[Jordy]

I am absolutely blown away by the quotes of R32-40 000 for this process.

Orphan made a comprehensive post that is well worth reading here where he gave figures of :

Exchange4Free - R9,500.

FXCapital - R7,750 per family unit

[Tiermelk]

I am absolutely blown away by the quotes of R32-40 000 for this process.

I guess you pay for brand...

So how much money do you need in an RA to make it worth while to pay these fees... Because getting money out of an RA is the only reason to do this (that I am aware of).

When you cash out your RA you pay 25% tax and then the insurance company takes anther 20 odd % depending on the type of RA?

[jenksinoz]

Thank you to all of you who took the time to respond. The link to Orphan's post was excellent.

We are indeed needing to do a financial emigration as this is the only way we can get our pension funds and RA's paid out before we retire (which is a good couple of decades away). We figure we will just cut our losses and get what money we can out of the country now. With the inevitable increase in exchange rate over the next 20 years, what we lose in tax now we might lose (plus more) in exchange rate if we leave it until we retire to get that money. That is all we have left there. Sold the house and got that money over a year or so ago.

Cashkows have been very helpful, knowledgable and responsive but I cannot justify their fees when their competitors are offering a similar thing at half the price!! The amount of forms will be the same whoever is involved and there will still be work to do on our behalves. At the moment the only advantage I see is that Cashkows are offering to co ordinate tax returns and keep going on about the "Complete Package." Does this warrant double the fee??

The Skype discussion on Friday will be interesting!

[Jordy]

When I get round to the process myself one day, I am keen to find out if it is indeed as complicated as these companies make it out to be that would require R32000 in fees. or is it just a case of tapping into a customer base that is so gatvol of bureaucratic processes that they "will just cut our losses and get what money we can out of the country now."

[Hugo2]

Formal emigration cost depends on the nature of the assets, not the value. You can therefore reduce the cost substantially through a phased process done by yourself, with the assistance of your tax adviser, insurance and forex broker! As a general rule, only people with trapped RA's benefit from formal emigration. Most other assets can be transferred out of SA without completing formal emigration. But if you need to formally emigrate and gain access to that RA, do the following steps before you approach any formal emigration agent: transfer all cash out using the foreign investment route! R20m er family is the guideline not the ceiling. oK so what is cash? All JSE listed instruments, all retirement funds save for RA's, loan accounts and all cashvalues in policies such as endowments! Yes, do not wait for a X4Free or Cashkows to emigrate you. Cash out yourself (after taking tax and financial and retirement planning advice in your new home country) and transfer out as part of R10m FIA. If you have a trust, consider closing it down and transferring assets out. Close the trust before you emigrate. It may still be listed on MP336 for 3 years but not a blocked asset. For many, specially in cases where your parents created and or funded the trust, do NOT formally emigrate without good research. Once emigrated and your parents or one of them resides in SA, you can extract less than someone that has not emigrated. Free marketing calls is like a free lunch! Ask why? Rather pay your tax adviser or cross border adviser for true reliable advise! It may not be in your interest and it may not be advisable to formally emigrate. Pensioners living abroad can take full R10m plus, yes plus all their annual pension out of SA, often taxfree without formal emigration!

[RDD]

FX Capital will do the entire formal emigration process (including Tax Clearance, opening blocked bank account and transfer of monies) for a very reasonable fee.

I'd recommend.

[jenksinoz]

Great practical advice - thank you Hugo2. We have no cash in SA. Only one RA and a pension preserver fund each. We have been told that my pension preserver fund needs to be transferred to a RA (via a section 14 something) in order for us to get the cash out. I was a government employee (education) before and apparently the pension preserver fund takes on the rules of the previous fund. The rules are such that a government employee may not cash out their pension fund before retirement even for emigration purposes.

We have been told that the only way to get the pension preserver funds paid out is to do the financial emigration. Does this sound accurate Hugo2 ?

Ours should be fairly straight forward other than having to catch up on 6 years of tax returns for both of us.

Edited April 16, 2015 by jenksinoz

[Kanniewagnie]

We used both Exchange4Free and Cashkows.

Exchange4Free by far gave better service and rates. They were quick and efficient. Their documents were easier to complete.

We found that Cashkows, once the money was paid into their account, had a lot of things they suddenly had to check and double check, waiting for you to confirm certain details, which was already confirmed in previous documents & emails. Asking for supporting documents which were already given to them. And then because of the day or 2 or 3 delay, the exchange rate is higher... And we could not help to wonder if they do this to benefit from interest earned on our money being in their account longer than necessary. They don't come back to follow up e-mails for days.

Before the money was paid over to them (cashkows) they were very quick and keen to answer. But once they had the money in their account, their service changed like night from day.

Exchange4Free on the other hand got back to our e-mails within minutes. They did not have long stories about spot rates and were not trying to make excuses for not giving the best possible rate.

This was our personal experience and yours may be different, but this is how we found these two companies to compare - doing business with both the past week.

[Tiermelk]

For many, specially in cases where your parents created and or funded the trust, do NOT formally emigrate without good research.

Hugo2, could you possibly extend on the risks of doing this?

[Shampoo]

I was advised to formally emigrate and quoted R20k. Only later did I find out that I need not have formally emigrated as Hugo stated above.They just wanted my money.If you really need to and have family in SA, you can get it done for under R2k. If not, I would suggest Hugo do it for you as he will not b s you into "Formally Emigrating" if it's not required.

[jenksinoz]

Just a quick update for those still following our thread..

We are going down the road of financial emigration as we now only have 2 pension funds and one RA left in SA. We phoned a person from Exchange 4 free regarding financial emigration as all we had had from them after sending an email query was a cut and pasted email showing information that is readily available on their website. This person was not aware of a section 14 transfer (which is what we require to release the money from a pension fund ruled by the GEPF rules to an RA). She did say that they can only surrender policies that are allowed to be surrendered and it was not their responsibility to know if your policy could be surrendered or not. With regards to the tax returns she suggested we just try and get clearance form sars with out updating our tax in case sars had closed our files due to inactivity. If we don't get clearance then we would have to find someone to do the tax for us. They do not offer this service. But did refer me to someone they deal with frequently. They do not offer to do your final tax return after financial emigration and then close off your tax file. If we didn't have the one policy that does require a section 14 transfer through the FSB we would probably consider going this way knowing what our responsibilities are with regards to sars.

We then had a Skype conversation with the rep from Cashkows. He was very professional and did not put other companies down, just spoke of what their company offer and gave reasons for their fees.

Their sales pitch goes that they offer a turnkey solution and will do all of the work necessary to get your money tied up in policies and RA's paid out to you. They only take payment once all your monies are in the blocked rand account. We did mange to negotiate some reductions on our many tax returns and the fact that we have more than one policy to surrender. They will provide us with all the forms necessary and will have pre populated them with our information for our convenience. We all know how sticky some government departments are with forms. They do have a whole team of people to deal with your case. A tax consultant, financial planner, service consultant etc. which explains their fee structure somewhat. Mention was made of identity fraud and that by sending documents to just one place cuts down on the likelihood of that.

We still think it is a lot of money but did find them impressive. Doing over 300 of these a month they do seem to cover all eventualities. They have been up front about all costs and also have a contact in Australia to advise us on how to proceed with the money once it arrives here to make sure we pay the least amount of tax here (taking into account the double tax treaty - something to that effect). All sales pitch I know and we are quite capable of filling out forms etc. But as we are both working full time and weekends are full of kids sport etc. it might just be a way of completing this process painlessly.

Although still undecided we are certainly feeling more reassured by Cashkows at this point. Naturally we realise this is a lot of sales talk we have had from them, but at least they were knowledgeable and professional. They did raise some interesting points about the process.

Once you convert the fees to dollars, the difference seems less significant and the convenience factor appeals more!

Decision pending......

Very grateful for a community like this where people are so willing to share information and opinions in a non judgemental way, thank you for all the information and experiences shared .

[FromDurbs]

Hi

I need some clarity, @Hugo2, I am sure you can help.

I am in the process of leaving SA for Oz.  I have some cash, a house that I do not intend to sell in the next year (but I can be convinced to change my mind) and lots of RAs.  I also have some investments that I would like to not cash out immediately if not needed.  There will be monthly income through rental of the property.

I understood that I could take R1 mil out of the country now, as travel allowance. 

Would I be able to take R1 mil each year after that - I don't have that much money (I know I sound rich now),  but there would be more than R1 mil in the year the house sells. 

If I never financially emigrate, will I be able to remove a little bit of money every year?  I am willing to keep the RAs in SA, I would just like to be able to use the money when they do start paying out in a few year's time. 
Can I leave SA, permanently, never financially emigrate and get the money for my house out of the country and take the cash portions of RAs and eventual monthly contributions of RAs out of the country, a little bit each year.

I though this would work, but have read on the forex documents that you can only take the R1 mil per year within the first 12 months of leaving.

A

 

[Marcodasilva]

If your RA is under R 100k do you need to go the blocked account route, i have read that you do not need to financially immigrate to get your RA's out. But my RA consultant said Old Mutual need the below documents?

 

Please see below the outstanding requirements received from Old Mutual Wealth with regards to the RA withdrawal for yourself and wife;

Documents required when emigration is in progress:
- Tax clearance certificate from SARS or IB-IT21
- MP336: (Y/N)
- Letter from Authorised dealer confirming emigration e.g. Std Bank off shore

[MJames]

Hi All,

 

I though I would put my 2 cents into this conversation...
I have researched and spoke to many of my friends in Oz who have emigrated already. They have all been in contact with the companies mentioned above and another company called Expatri8 expatri8.com.

 

I have been in contact with Claire from Expatri8 and she has been amazing. Basically holding my hand through this whole financial emigration process and for less than R5000. I was petrified after looking at some of the costs involved.. % of the amounts transferred etc... Expatri8 ensure that they charge a flat rate no matter what the actual amount of Retirement Funds I want to transfer.
 

 

[Ta2Bryan]

19 hours ago, MJames said:

Hi All,

 

I though I would put my 2 cents into this conversation...
I have researched and spoke to many of my friends in Oz who have emigrated already. They have all been in contact with the companies mentioned above and another company called Expatri8 expatri8.com.

 

I have been in contact with Claire from Expatri8 and she has been amazing. Basically holding my hand through this whole financial emigration process and for less than R5000. I was petrified after looking at some of the costs involved.. % of the amounts transferred etc... Expatri8 ensure that they charge a flat rate no matter what the actual amount of Retirement Funds I want to transfer.
 

 

Thanks for this. Will definitely contact them when we have our Visa 

[ChrisH]

On 3/9/2018 at 11:49 PM, MJames said:

I have been in contact with Claire from Expatri8 and she has been amazing. Basically holding my hand through this whole financial emigration process and for less than R5000. I was petrified after looking at some of the costs involved.. % of the amounts transferred etc... Expatri8 ensure that they charge a flat rate no matter what the actual amount of Retirement Funds I want to transfer.

 

Hey @MJames , welcome to the forum!  Thanks for the recommendation, we're actually going through the process ourselves at the moment.

 

I notice that you're still in South Africa, I wasn't aware that you can actually do financial emigration before emigrating.