SOUTH AFRICANS HAVE ONLY ONE MONTH LEFT TO FINANCIALLY EMIGRATE

On Tuesday 13 October 2020 in Parliament, National Treasury and SARS laid down the new Financial Emigration law and made it clear that post 1 March 2021, your retirement money will be locked in for three years, meaning you are not allowed to touch it or best apply it to your personal circumstances.

Let us help you complete your Financial Emigration today, which guarantees non-tax residency through SARB and SARS providing protection from #ExpatTax2020, while allowing you to move your funds offshore before the change takes place early next year.

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BACKGROUND

On Tuesday 13 October 2020 in Parliament, National Treasury (“Treasury”) and SARS presented to the Standing Committee on Finance on a number of proposed amendments to legislation, which amongst others, would directly affect South Africans who have already moved abroad, or are planning on moving abroad. The feedback to stakeholders, specifically around the withdrawal of retirement funds upon financial emigration, was certainly one which was foreseen after it was proposed in the draft Taxation Laws Amendment Bill (“TLAB”) in July 2020.

The changes make it more difficult for South African expats to withdraw their RA’s and Pension Funds when Financially Emigration through SARS and SARB for a minimum of 3 years post March 2021.

This is in line with the February 2020 Budget Speech announcement to phase out the SARB portion of Financial Emigration and replace it with a stringent verification test – effectively making it extremely difficult to move money outside of SA when emigrating.

HOW SOUTH AFRICANS ABROAD ARE AFFECTED

The payment of lump sum benefits upon emigration is to be removed and a new test be introduced where payment is only allowed where a person has remained non-tax resident for a period of at least three consecutive years or longer. This is a double whammy on the back of the “Expat Tax” amendment which took effect from 1 March 2020.

SARB Amendment for “retirement annuity fund”

NEXT STEPS FOR EXPATS

This announcement is not going to be well-received by the wider South African community. However, this has been in the pipeline for some time and the bottom line is – you have 6 months left to get your tax affairs in order and Financially Emigrate under the existing regime or face having your life savings trapped in South Africa at the mercy of SARBs new “three year rule”.

WHY US FOR FINANCIAL EMIGRATION?

Tax Consulting South Africa has been in existence for 17 years and are widely acknowledged as the market leaders in Expatriate Tax. The group was entrusted by Barry Pretorius and South African expats worldwide to represent the Expatriate Petition Group (“EPG”) in parliament to fight the law change, which resulted in the R1.25mil exemption, and also authored the LexisNexis’ first of its kind Expatriate Tax textbook released late year.

Our multidisciplinary team of more than 100 professionals including Tax Attorneys, Tax Practitioners, Chartered Accountants (SA) and Emigration specialists, will take over the entire FE application process on your behalf. This gives you peace of mind that the administratively burdensome and somewhat complex process is handled end-to-end, where we deal both with SARS and SARB, ensuring full compliance with all legislation.

WHEN YOUR FINANCIAL EMIGRATION IS SUCCESSFULLY COMPLETED THROUGH OUR COMPANY, WE GUARANTEE NON-TAX RESIDENCY ON RECORD WITH SARS AND SARB.

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