Money above your travel allowance

[arabella164]

I have:

1. a PR visa and have managed to open a bank account in Australia.

2. Already done and electronic transfer into that account for the full travel allowance for this year (R160000).

Now:

1. When I leave, I will carry A$10000 (R60000) in cash with me.

2. I may also get a travelling companion to carry A$10000, or give me a bank draft/cash A$ for R60000.

Technically, $AR$ will not know about this extra money.

My question is, if I deposit this extra money/ the cash I am carrying into my Australian account, are there any tax implications on the SA side (seeing that I have already taken out my full allowance) and any implications on the Australian side?

[Guest Bronwyn]

Hi Mohammed

Please be very careful. Anyone googling can pick up your post on the net. It is a big problem getting money out due to exchange control laws in the country. I received an email from FNB Forex this week stating:-

With regard to what South African holiday/business travellers may or may not do in terms of money and exchange controls, the folllowing is applicable:

i) Travel allowance of up to R 160,000.00 per calendar year per person 12 or older and R 50,000.00 per child under twelve may be availed of in foreign currency in any form e.g. travellers cheques, foreign cash or S.W.I.F.T. transfer. S.W.I.F.T. transfers are permitted on the express condition that the funds are transferred abroad into an account held in the applicant's name. Funds may not be transferred into the account of a third party. South African credit cards may also be used by holiday/business travellers within the limits above.

ii) These allowances may be issued against production of a flight ticket reflecting a journey commencing from South Africa any may only be purchased within 60 days prior to departure.

iii) The traveller must sign a declaration with their bank when purchasing their currency confirming amongst other things that:

a) Their travel allowance will be utilised for the specific purpose stated i.e. travel expenses, holiday shopping etc.

Any unused travel allowance must be sold back to their bank within 30 days of their return.

c) They will not exceed the applicable limits.

There is also a limit to how much cash you can take on the plane, and you will be asked on your arrival card how much you have on you. They have got very clever closing loopholes.

The implication on the Aus side is that you must remember to give your Aus bank your Tax File number ASAP, or they withold 50% of your interest as non-res tax.

Edited October 24, 2007 by Bronwyn

[Cindylou]

If you have already taken your annual travel allowance and are not emigrating you are not allowed to take any additional funds from SA.

As you have PR you are allowed to emigrate from SA. If you emigrate you can take R2mio and an additional settling in allowance of R160K.(individual allowance, family allowance is R4mio)

If you do not emigrate you are allowed to make a foreign investment to the maximum of R2 mio.

Both options require tax clearance from SARS.

Regards

Cindy

[Just B]

Cindylou,

When emigrating is the amount not R400 000-00 per adult that you can take out the country and any additional amount above that is subject to a 10% tax/levy?

Perhaps someone on the forum can assist.

[SA2AU]

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QUOTE(K & B @ Oct 24 2007, 08:28 PM) <{POST_SNAPBACK}>

Cindylou,

When emigrating is the amount not R400 000-00 per adult that you can take out the country and any additional amount above that is subject to a 10% tax/levy?

Perhaps someone on the forum can assist.

You are allowed R2m per adult whether making a investment or formally emigrating. The levy applies when emigrating ONLY for amount above R2m.

[Cindylou]

-->

QUOTE(K & B @ Oct 24 2007, 12:28 PM) <{POST_SNAPBACK}>

Cindylou,

When emigrating is the amount not R400 000-00 per adult that you can take out the country and any additional amount above that is subject to a 10% tax/levy?

Perhaps someone on the forum can assist.

For emigration facilities please refer to section T of the Exchange Control Manual. Straight from the horse's mouth!

[JohanK]

ii)These allowances may be issued against production of a flight ticket reflecting a journey commencing from South Africa any may only be purchased within 60 days prior to departure.

Hi guys

I wonder if someone can give me some clarity on the above statement received from FNB, I was told by Rennies Bank before we departed South Africa that this law has changed and your air tickets does not need to originate from SA. So what I would like to know is if I go back to SA on holidays and I produce my return air fair tickets to Australia will I still be eligible for the yearly travel allowance of R 160000.00

Any advise will be greatly appreciated!

[Cindylou]

I have not heard this at all, in fact I was advised to the contrary: I was told that only if you have air tickets issued in SA can you claim travel allowance.

Perhaps you should ask Rennies for confirmation of this in writing or to refer you to the relevant official website. Could prove costly if they are wrong.

[arabella164]

I have:

1. a PR visa and have managed to open a bank account in Australia.

2. Already done and electronic transfer into that account for the full travel allowance for this year (R160000).

Now:

1. When I leave, I will carry A$10000 (R60000) in cash with me.

2. I may also get a travelling companion to carry A$10000, or give me a bank draft/cash A$ for R60000.

Technically, $AR$ will not know about this extra money.

My question is, if I deposit this extra money/ the cash I am carrying into my Australian account, are there any tax implications on the SA side (seeing that I have already taken out my full allowance) and any implications on the Australian side?

Any answers to my question?

[Nilo]

Hi

On the flight you have to declare if you have AU $ 10 000 and more! DO THAT! if you have more. If they catch you out you 'll be in big sherbit!

They have this program on TV here about Customs and it is SCARY very SCARY!!!

So declare what you need to.

Just thought I'll stress that.

Nilo

[Guest Bronwyn]

The implication on the Aus side is that you must remember to give your Aus bank your Tax File number ASAP, or they withold 50% of your interest as non-res tax.

[Amaozzie]

Hi Mohammed,

Can you please shed some light on getting your bank account set up OZ. Which bank etc.

Thanks,

Craig

[JohanK]

I have not heard this at all, in fact I was advised to the contrary: I was told that only if you have air tickets issued in SA can you claim travel allowance.

Perhaps you should ask Rennies for confirmation of this in writing or to refer you to the relevant official website. Could prove costly if they are wrong.

Hi Cindy

The only refarance I could find on the Reserve Banks website was the following but I will include the document as I might have missed something.

"Definition of Passenger Ticket

A ticket issued in respect of travel arrangements, inclusive of electronically issued

tickets (“e-tickets”)"

[arabella164]

Hi Mohammed,

Can you please shed some light on getting your bank account set up OZ. Which bank etc.

Thanks,

Craig

I am fortunate enough to have a permanent resident visa. As a result, I went online to the Commonwealth Bank website, and applied for a bank account. I was contacted and the account was opened within a week - no documentation necessary. I was then given my branch and account number as well as the bank SWIFT code.

I bank in SA with Investec and I asked them to do a SWIFT transfer into my Australian account. I am sure any bank, or even Mastercurrency, can do this for you. I needed the following documentation:

BOP form (Balance of payment/Forex purchase form)

Travel declaration (that the money is for holiday etc.)

Copy of passport

Copy of air ticket

The money was then transferred within 3 days. When I reach Australia, I have to show proof of identity at the bank. I will then be given a debit card for the account and will be able to draw the money.

This is also the cheapest way of transferring money. I was given a reduction on the exchange rate, and the only fees/commission for the SWIFT transfer was 0.57% - so if you want to transfer R100000, you will be charged R100570.

[Wodwik]

Mo: In doing my travel allowance I asked about transferring the limit, and then using my credit card. Std Bank was very specific in that once you have used the full 160k you will not be allowed to exceed this by using a card. I assume the same applies to depositing extra cash. Be very careful as SARS is very wide awake. (Also, if the NIA can spend time investigating a hoax tornado email, you can bet they have the resources to nail the wayward traveller. They probably keep an eye on this site too.)

For your extra cash I think you are allowed to give a gift of R30k annually.

Wannabe: Go to Commonwealth website and check the 'moving to Oz' section. All done online.

[Swerwer]

Hi Mohammed

a) Their travel allowance will be utilised for the specific purpose stated i.e. travel expenses, holiday shopping etc.

Any unused travel allowance must be sold back to their bank within 30 days of their return.

What happens when you return to SA within a year only to visit? Do you still have to sell back or declare this travel allowance, as you will be returning to Oz and for Tax purposes you now actually have Oz as your country of residence? Or do you simply return? Does this visit count for anything? Or can you use the travel allowance for the entire year, no matter how many times you travel back and forth?

[Guest Bronwyn]

Can someone please tell me - If your ticket must originate in South Africa, do they mean

1) It must actually be purchased in South Africa; or

2) You must fly out of South Africa

?

We bought a ticket from Aus - JHB - Aus. It was purchased in Australia at Flight Centre. When we tried to bring the travel allowance back it was stopped by the bank because the ticket did not originate in South Africa.

I still don't understand exactly what the problem was.

Any advice?

Thanks

Bronwyn

Edited October 26, 2007 by Bronwyn

[Amaozzie]

Mo / Wodwik,

Thanks for the advice.

Craig

[JohanK]

Can someone please tell me - If your ticket must originate in South Africa, do they mean

1) It must actually be purchased in South Africa; or

2) You must fly out of South Africa

?

We bought a ticket from Aus - JHB - Aus. It was purchased in Australia at Flight Centre. When we tried to bring the travel allowance back it was stopped by the bank because the ticket did not originate in South Africa.

I still don't understand exactly what the problem was.

Any advice?

Thanks

Bronwyn

Hi Bronwyn

If I read the document I attached previously I cannot see were it mentions that the tickets has to originate or be purchased in South Africa and I am sure some person a Rennies Bank told me before we left the county you are able to take the full travel allowance even if you go back on holiday to Sa and the tickets originate from Australia. She told me this in the same year the last big changes were made to the exchange controls act. I will also have to clear this, as I need to bring some money from SA next year when we go back on holidays.

Once I get all confirmed by a trust worthy person in SA I will let you know.

[arabella164]

Mo: In doing my travel allowance I asked about transferring the limit, and then using my credit card. Std Bank was very specific in that once you have used the full 160k you will not be allowed to exceed this by using a card. I assume the same applies to depositing extra cash. Be very careful as SARS is very wide awake. (Also, if the NIA can spend time investigating a hoax tornado email, you can bet they have the resources to nail the wayward traveller. They probably keep an eye on this site too.)

For your extra cash I think you are allowed to give a gift of R30k annually.

Wannabe: Go to Commonwealth website and check the 'moving to Oz' section. All done online.

You are right. The best is to try and do all of this above board, even though the exchange control amount of R160000 sucks.

Another word of advice: If you want to take out the full R160000, rather do something like this:

1. Take out R100000 in travellers cheques, bank draft etc.

2. Take R30000 in cash, so that you can start using this immediately.

3. Leave the balance of R30000 in your credit card account and use that overseas. This is important as you may need a credit card facility for transactions in the foreign country where you will not be afforded any credit privileges.

[skaz]

Hi there

I have also opened an account with NAB over the phone - took about 20 minutes.

I have also applied for and received a tax clearance for foreign investment and can take up to 2mil extra out for investment.

This will be transfered into my account in Aus.

Regards

Johan