Taking money over

[Spider]

Hi All,

My boyfriend's parents have put quite a bit of money aside for him since his 21st a few years ago and it amounts to over R100 000. Now, what do we do when we do eventually immigrate to take the money over with us as financial support in a legal manner? Is there a way you get certain funds cleared and so forth?

Thanks

C

[Bob]

Chandi!

It may be wise to consider not just taking your boyfriend's 21st birthday money out, but every penny you can out.

There are moves of discontent in Sth Africa that I hear.

If Zuma sets up becoming President, then COSATU will be in power, nationalising all the banks and institutions throughout South Africa in the usual dogmatic "Union" fashion that doesn't bear much resemblance to financial reality.

. . . . . then see if you can send any money out of South Africa??

Also, without alarming you unnecessarily, when an African gov't (the A.N.C.) becomes challenged, they hang on to power any way they can . . . . by fixing the voting system, by paying back their supporters with land and gov't jobs, etc. . . . . . and a whole power struggle will engulf South Africa. Every government that is threatended will start looking around for a scapegoat . . . . . no second prizes for who that will be!!

Just look to the north for examples.

I believe the Australian High Commission in Pretoria will be blocked with everyone wanting to leave then.

. . . . . just a thought.

Edited October 30, 2006 by Bob

[Spider]

Hi Bob,

i hear what you saying and totally agreeing, that's why i need advice on the process of taking out all our money in a way that it won't create problems for us...like, is there a process to follow or docs to complete...we want everything out when we get out...

I guess this is the reality we live in over here...

[Guest Bronwyn]

Chandi we are busy with the same process. It is a little complicated due to the exchange control regulations we still have in S. Africa.

I will quote you directly from the written information we received from Magna International Movers (I know it's not exactly a text-book, but it's all I have & it's the most recent info ):-

"STANDARD ALLOWANCES FOR EMMIGRANTS & THOSE WHO ARE RE-LOCATING OVERSEAS"

TRAVEL ALLOWANCE - R160,000 per person, plus R50,000 per child under 12

PLUS

SETTLING IN ALLOWANCE (Emmigrants only) - R4,000,000 per family unit

- R2,000,000 single person

PLUS

HOUSEHOLD EFFECTS, CARS, BOATS & TRAILERS - R1,000,000 per family unit in assets

If you are re-locating overseas (South Africans temporarily abroad) there is no settling-in allowance - only the travel allowance applies, provided this has not been used in the same calendar year.

The allowance for Household Goods & Cars is the same as for emigrants"

So, this means:-

You need to consult the Forex Dept at your bank for advice. But be very carefull what you say to them, as they have the authority to "block" your bank account if you tell them you are emigrating. It is very difficult to get funds out of blocked accounts.

Many people say they are 'Re-locating' (NOT emigrating), and take what they can under the Travel Allowance (seems R160,000 per adult per year). Once you are set up in Australia and your money is over there, you can re-assess the situation and decide whether to close your bank accounts here once & for all.

The whole situation must be handled carefully. We are meeting with an auditor tomorrow to ensure we don't make a mistake of tell the bank the wrong thing.

Bronwyn

[Gautenger]

Hi Bronwyn

Please keep us informed. This is a real delicate issue that everybody struggles with.

[Mara]

Hi All

The banks will only block your funds which are in excess of the R4,000,000 family or R2,000,000 single emigration allowance, as that, by law, you are allowed to remove from the country.

Mara

[woodag]

. . .

Many people say they are 'Re-locating' (NOT emigrating), and take what they can under the Travel Allowance (seems R160,000 per adult per year). Once you are set up in Australia and your money is over there, you can re-assess the situation and decide whether to close your bank accounts here once & for all.

I can't tell you anything useful from my own experience (too long ago, too many rules have changed). However, I believe that in addition to the travel allowance each SA taxpayer can also "invest" a substantial amount overseas.

If you have not seen it, there is a lot of information in the SACanada forum which would apply equally well to emigration to Australia.

In particular have a look at the threads starting here

http://www.sacanada.org/index.php?showtopic=3761

and here

http://www.sacanada.org/index.php?showtopic=4311

Note that some of the limits mentioned there and elsewhere may have been increased.

[Spider]

Hi Everyone,

so basically, i will legally be allowed to take R160 000 each for myself and my boyfriend for purposes of relocating...

This is exhausting looking at all the ins and outs financially cause we have to be so careful nothing is overlooked and then we're in for it...

recommendations on how best to move the money across?

[Guest Bronwyn]

Hi Chandi

As I understand it you are correct. Remember the money is your 'Travel Allowance' and you are 'Re-locating'.

You must phone the Forex Dept of your bank here. They will fax you a BOP Form (Balance of Payments Form). They will want a copy of your passport & ticket. You must be 'FICA'd' (ie. the Bank has a copy of your utility bill etc. on file). But we mostly are all FICA'd now anyway (Financial Intelligence Control Act) as that law came in over a year ago now.....

The next part I am not so sure of. We already opened our bank account at ANZ Bank, so I am just going to ask the Forex person at my SA Bank to transfer the funds to ANZ Bank. You will sign some Forex forms and pay their commission.

I hope that's all!

Bronwyn

[Ziggy]

Hi there

THe other option is to go to Rennies bank. You apply for a "credit card" and you can put in Aus $30,000 on the spot. THe card is valid for 5 years and more money can be deposited into the "account" every year by a family member. That is how I understand the lady behind the counter. You need your passport, ID and flight ticket. You will be asked why you need the money and MUST state it is for your holiday spending.

You can also do "an investement abroad" Open a bank account here, go the your local tax office and apply for a tax-clearance certificate. With that certificate you go to your bank and apply for an "Overseas investment", without mentioning anything about immigration. The max investent per individual is R2,5 mil, that means a husband and wife can take R5 mil plus their traveling allowance, plus the traveling allowance for the kids. If I remember correctly the rules state that you must be over 18 years of age and eligeble to make and investment.

Hope it helps

[Spider]

Hi there

That is definitely an interesting way of doing it...thanks for the info it helps so we can pre plan what we will do...

[Springbok]

This may not work for everyone, but here is some pointers from a friend who has been living in the USA for the last 5 years:

1. I would not let anyone know I am emigrating. ESP not the SARB!. Just visiting ek sê. Even a one way ticket isn't proof of animus non revertendi for loss permanent resident status purposes. Take out VISITING rand allocation.

2. The bank would probably charge you a fortune.

2.1 Get an AMEX Blue credit card. NO LIMIT. Place as much of your funds (Rands) in it as you can. They LOVE you to have money in it. USE it anywhere. No official notification. Huge points advantage with very nice rewards. The more you use it, the more points you get - free air miles, e.g., or even dollar cheques we received!

[FYI: Amex Blue card is a see-through card with a chip in the centre.]

2.2 You can walk in a car showroom and buy a US$100k car with it!

2.3 Place minimum funds in AUSSIE bank. You can open other credit cards that give great points for use in Aussie when you get there. BUT USE Them. They probably have a point system as we have here - that requires that you to use credit - to gain a credit history. To have the highest score for credit worthiness purposes - to be charged the lowest interest rate for purchases from houses to TV sets - you need to prove that you have used credit - even if you don't have to - AND keep the credit cards at not more than 80% of credit allowed. SO: If you ever think that you will need credit - car, house e.g. - MAKE DEBT as soon as you get there even if you have oodles of cash handy. The credit bureaux insist on seeing that you have managed your debt wisely over +-2-5 years!. AND DO NOT pay the cards off every month!!!

3. Keep SA bank accounts live. Do not close them. Many years later they will ask for residence status. Then close them, if you want.

Here is the link for the Amex Blue Credit Card.

[Tazz]

This may not work for everyone, but here is some pointers from a friend who has been living in the USA for the last 5 years:

1. I would not let anyone know I am emigrating. ESP not the SARB!. Just visiting ek sê. Even a one way ticket isn't proof of animus non revertendi for loss permanent resident status purposes. Take out VISITING rand allocation.

2. The bank would probably charge you a fortune.

2.1 Get an AMEX Blue credit card. NO LIMIT. Place as much of your funds (Rands) in it as you can. They LOVE you to have money in it. USE it anywhere. No official notification. Huge points advantage with very nice rewards. The more you use it, the more points you get - free air miles, e.g., or even dollar cheques we received!

[FYI: Amex Blue card is a see-through card with a chip in the centre.]

2.2 You can walk in a car showroom and buy a US$100k car with it!

2.3 Place minimum funds in AUSSIE bank. You can open other credit cards that give great points for use in Aussie when you get there. BUT USE Them. They probably have a point system as we have here - that requires that you to use credit - to gain a credit history. To have the highest score for credit worthiness purposes - to be charged the lowest interest rate for purchases from houses to TV sets - you need to prove that you have used credit - even if you don't have to - AND keep the credit cards at not more than 80% of credit allowed. SO: If you ever think that you will need credit - car, house e.g. - MAKE DEBT as soon as you get there even if you have oodles of cash handy. The credit bureaux insist on seeing that you have managed your debt wisely over +-2-5 years!. AND DO NOT pay the cards off every month!!!

3. Keep SA bank accounts live. Do not close them. Many years later they will ask for residence status. Then close them, if you want.

Here is the link for the Amex Blue Credit Card.

Hi springbok

What are the transaction charges like on the amex?

[Springbok]

Hi springbok

What are the transaction charges like on the amex?

Have a look at the Amex Blue card website.

Branch Charges

ATM fees (excl Saswitch fee) = R2.85 plus 0.9%

Saswitch fees =R2.85 plus 0.9%

Over the counter payment fees = R2.85 plus 0.9% (max R50.00)

Over the counter withdrawal fees = R2.85 plus 1% (max R90.00)

Overseas withdrawal fee = R33.00

Post dated cheques = R60.00

EFT payment = R2.85 plus 0.5% (max R20.00)

Card Fee = R145 per annum, or R160 per annum of you want the Rewards programme.

[Mara]

Suggesting that someone NOT PAY OFF THEIR CREDIT CARDS monthly! Do you have an idea of the interest rate that is charged in Australia on outstanding balances on credit cards? Could be anything from around 10% to 20% but mostly to the higher end! You can still pay them off fully every month to have a good credit rating.

What you must be careful of. The central credit bureau keeps track of your credit rating. Everytime you get something on credit it is referenced to them. If you have three credit cards, with a combined buying power of say $15000 then when you apply for credit, whether you have balances on the cards or not, they are going to say that your repayment on the card monthly is $1500, which could seriously damage your chances of attaining credit. So my suggestion is just be careful.

[starfish]

You can also look at the S.A. Exchange Control Manual for more information - look at www.reservebank.co.za. The manual is a little cryptic, but the information can be found.

My own approach to this situation would be take out the max travel allowance on the LSD trip (R160k per adult, R50k per child under 12), open a bank account in Aus and deposit it when there, then when the time comes that one's S.A. property, investments etc are sold, use the R2mill offshore investment allowance (per adult older than 18) to get those proceeds offshore, and then when actually relocating, use the max travel allowance again - provided that this trip is in a different calendar year to the LSD trip - to get any remaining funds out of S.A.

I see that the manual also mentions a R1mill allowance for the export of hosehold and personal effects, which is applicable to "SA residents proceeding abroad on a temporary basis" when working temporarily overseas. If you use this you have to furnish an undertaking that you will repatriate this all on your return to S.A. Also, you have to undertake not to use your S.A. credit card while overseas. This would seem to preclude one from leaving an income-generating asset in S.A. and using the funds in Aus.

Has anyone here epxerienced any problems using an S.A. credit card overseas while living in Aus ?

[ExASP]

Short and sweet answer...No...you can use your credit card as long as you have funds in it

[Swerwer]

My take on this is....make sure it is possible to do overseas investments of certain amounts...don't just assume you will be able to do it. Talk with people which actually did it. You have to be a SA taxpayer to invest overseas, your tax status need to be cleared and you must receive a tax-clearance certificate.

What you know for sure is:

you can take the travel allowance (for a family of 4 with 2 small kids it is R420000)

You can use your credit card with money you deposited in SA up to transactions of R20000 per transaction: use this to buy all the stuff you need over in Oz

A family member can transfer R30000 as a gift per year to your account.

Don't bet on the overseas investment...most probably you can only get it paid out to South Africa, since these investment companies have strict rules they have to comply to.

Who on the forum can perhaps attest that they have done it (move money out of the country using an investment) and is it possible to withdraw it in Oz?

[celeste]

Suggesting that someone NOT PAY OFF THEIR CREDIT CARDS monthly! Do you have an idea of the interest rate that is charged in Australia on outstanding balances on credit cards? Could be anything from around 10% to 20% but mostly to the higher end! You can still pay them off fully every month to have a good credit rating.

What you must be careful of. The central credit bureau keeps track of your credit rating. Everytime you get something on credit it is referenced to them. If you have three credit cards, with a combined buying power of say $15000 then when you apply for credit, whether you have balances on the cards or not, they are going to say that your repayment on the card monthly is $1500, which could seriously damage your chances of attaining credit. So my suggestion is just be careful.

I know this is an old thread but just need some clarity on this issue.

An aquaintance of ours who has relocated to Europe has just sold all his SA property investments and he said he was deposting the money into his credit card and would then make an online payment from the credit card to his account abroad. Is this legal at the moment as it sounds too simple and too big of a loophole to be so?

Good advice on obtaining a credit card tho, thanks.

I need to lodge 100 000 $ in government bonds in Aus for my visa and my bank advised that one can make overseas investments of up to R2 million abroad just need a tax clearance cert from SARS so they know all tax is in order. So surely if one only has cash up to the limit then all should be okay.

Thanks Mara for the tip on credit card interest. Even here is SA I like to clear mine every month so I effectively enjoy free credit.

[Ziggy]

Edited March 3, 2007 by Ziggy

[celeste]

Who on the forum can perhaps attest that they have done it (move money out of the country using an investment) and is it possible to withdraw it in Oz?

Swerwer we did it...

The rules for an overseas investment sates, that you must be 18+, up to date with your taxes, there the requirement of a tax clearing certificate and that you are eligible to invest, meaning that you haven't exceed the R2 mil per tax payer. That means that a married couple can invest $4 mil plus the traveling allowances... Oh, and the new one; proof of a residential address in SA...

When we went to NZ I opened a bank account in NZ, got my tax-clearance certificate and deposited the money into my NZ account (Whish I had the max to invest... )

We all call it an investment to get around the system, but it is actually a transfer of money from SA to where ever your bank account is...Completely legal and easy as pie...

Hi Ziggy

Thanks for that it confirms what the bank told me - but do you have any clue about the legality of paying a large sum into one's credit card and then using it to make a payment on-line to one's account abroad?

Who on the forum can perhaps attest that they have done it (move money out of the country using an investment) and is it possible to withdraw it in Oz?

Swerwer we did it...

The rules for an overseas investment sates, that you must be 18+, up to date with your taxes, there the requirement of a tax clearing certificate and that you are eligible to invest, meaning that you haven't exceed the R2 mil per tax payer. That means that a married couple can invest $4 mil plus the traveling allowances... Oh, and the new one; proof of a residential address in SA...

When we went to NZ I opened a bank account in NZ, got my tax-clearance certificate and deposited the money into my NZ account (Whish I had the max to invest... )

We all call it an investment to get around the system, but it is actually a transfer of money from SA to where ever your bank account is...Completely legal and easy as pie...

Hi Ziggy

Thanks for that it confirms what the bank told me - but do you have any clue about the legality of paying a large sum into one's credit card and then using it to make a payment on-line to one's account abroad?

[Ziggy]

Hi Ziggy

Thanks for that it confirms what the bank told me - but do you have any clue about the legality of paying a large sum into one's credit card and then using it to make a payment on-line to one's account abroad?

About the credict card I am not sure. Our credit card was stopped 6 months after we started doing overseas transactions...Rather go the "legal" way, where you get peace of mind that the money will be transfered.

A tax clearance only take about 3 weeks...

All the best

[Swerwer]

How do I go about applying for the tax certificate? Can I just phone SARS?

[Spider]

Hi there

I have sent a mail to my friend who does all the tax stuff, so i'll let you know what's best, although i think you just contact them with your tax number...but will confirm if you like?

C

[JohanK]

Hi Swerwer

There is a form that you have to complete just a one-pager thing. You take it to your local tax office the last time I did it they told me it should take 15 workdays to issue your tax clearance certificate. They called me after 5 days and told me it was ready for collection. The most important thing is all your tax should be up to date.

That form you make a certified copy of and the day you want to do the transfer you take it to the bank. As I am typing this message I just received an email form my bank in SA to confirm that they will transfer some money in 2 days time.

Transferring money is much simpler then one think just make sure someone your stuff (Tax) is up to date and see to it that someone you can trust has full signing authority on your SA bank accounts.