South Africans invest money abroad for many reasons. The first reason is that SA expats residing abroad wish to withdraw their South African money and invest it in their new home country. For South Africans still living in the country, their reasons include spreading their investment risk by investing funds abroad in countries with more stable economies and hedging against the fluctuating rand by investing in a stronger more stable currency.
Make use of your annual investment allowances
If you are interested in investing abroad, you will be interested to know that every South African resident above the age of 18 has two annual allowances that they can use to transfer funds abroad:
- Single Discretionary Allowance
As a South African resident, you may transfer a total of R1 000 000 from South Africa every calendar year. Please note that all card transactions while you are abroad are included under this allowance.
- Foreign Investment Allowance
As a resident, you may also use this R10 000 000 allowance per calendar year. A tax clearance is required from SARS. This tax clearance is associated with the Foreign Investment Allowance and differs from a normal ‘good standing’ tax clearance. You may also transfer funds abroad in excess of these allowances.
This means that cumulatively between spouses you are allowed to remit R22 million offshore on an annual basis! This is the ideal way to ensure your financial savings are protected offshore from downgrades, the declining rand or any other negative economic or political events. You can even transfer larger amounts offshore, however it can take up to six months to obtain approvals from SARS and SARB.
Ensure secure and compliant processing
FinGlobal is a foreign exchange intermediary approved by the South African Reserve Bank and we have assisted thousands of South Africans with their foreign exchange transactions. Our expertise and partnership with Bidvest Financial Services ensure that we’re able to offer highly competitive exchange rates, low fees and streamlined process with unrivalled personal service. We will also obtain your tax clearance certificate if required. To find out more about our forex services contact us today.