What is the purpose of tax clearance?
South Africa has strict foreign exchange controls that allow the South African Reserve Bank to keep track of the outflow and inflow of capital in South Africa. Taxpayers over the age of 18 who are South African residents are eligible for the following allowances:
- R1 million single discretionary allowance (no tax clearance required from SARS)
- R10 million foreign investment allowance (tax clearance required from SARS)
If you are looking to transfer money out of South Africa and require a Foreign Tax Clearance Certificate, get in touch with one of our experienced brokers who will be happy to assist you through this process.
Tax clearance requirements: When do you need a tax clearance certificate?
As of 1 April 2015, the foreign investment allowance increased from R4 million to R10 million per person per calendar year and R20 million per family unit. Tax-payers over the age of 18 who are South African residents are eligible for this allowance. It is mandatory to have a Foreign Tax Clearance Certificate that is valid for 12 months to take advantage of this allowance.
The R1 million single discretionary allowance may be used for any legal purpose abroad (including investment purposes). This can be used solely at the discretion of the resident without any documentary evidence having to be produced as to the purpose of the transfer. No tax clearance is required to make use of this allowance.
The R10 million foreign investment allowance may be invested into offshore investment portfolios, property, bank accounts or other investments. You will require tax clearance to transfer these kinds of amounts of money.
We can submit your tax clearance application form to SARS and obtain your Foreign Tax Clearance Certificate for you, should you wish to make use of your R10 million foreign investment allowance. If you wish to exceed the amounts above, we can also assist you with applying to the SARB for special dispensation.
If you are considering investing your foreign investment allowance outside of South Africa, you may want to get in touch with one of our wealth advisors who can provide you with financial planning and investment advice. If you’re wanting to transfer your allowance, we can provide you with the best possible exchange rate and lowest processing fees around.
Can you transfer more than R11 million out of South Africa?
Should you wish to exceed this R11 million amount, we can assist you in applying for a Letter of Compliance from SARS. This will allow you to transfer more than R11 million in a year. Once this letter has been delivered, it must also be sent to the SARB for approval. Once approved, you will be able to externalise your funds.
There is no limit to how much money you can send out of the country with such an application, but each application is judged on its own merits. If you’re thinking about applying to transfer more than R11 million overseas, it’s a good idea to consult a reputable foreign exchange provider who can advise you on every step of the process.
We have experience with the SARS Letter of Compliance applications and can assist you through the process to ensure your application had the greatest chance of success. What’s more, once you have obtained your letter, we can transfer your funds at the best possible exchange rate and lowest fees.
Why transfer with us?
We are an established foreign exchange service with over a decade of experience, as well as offices across South Africa, the UK and Australia. As your forex partner, we can ensure you are always compliant, and you get the most competitive exchange rates. What’s more, we pride ourselves on exceptional customer service, and our South African team is always on hand and will be happy to assist you with any query you may have along the way.
Forget about your bank
Many South African’s first port of call when thinking of making large international money transfers is the bank. However, the bank falls short when it comes to advice, competitive pricing and attractive rates. A trusted forex provider can save you a considerable amount on every transfer you make and advise you on how to make the most out of every transfer.
Why our clients love our forex service
We transfer your money at excellent rates.
We are fully compliant with the South African Reserve Bank, Financial Services Conduct Authority and South African Revenue Services.
No obligation consultations
We offer all prospective clients complimentary no obligation consultations on their personal or business forex needs.
We always provide a personalised service and all our solutions are tailored to our clients’ needs.
Let us answer your questions about transferring money
You may have some questions about transferring your hard-earned money, and we understand. You are right to want to know more about our service before you choose to transfer with us.
Below are the answers to the questions we get asked most regularly.
If you still have questions after reading the FAQs below, you can contact our South African based team on +27 (0) 21 657 2133. If you’d rather keep things online, you can email email@example.com and we’ll help you out.
1. Once registered, how long does it take to activate my account?
As soon as we have received your compliance documents, your account will be activated within one working day.
If your remittance request exceeds R1 million, we will request a tax clearance certificate and PIN letter.
2. How long does a transfer take to be processed?
Once we have received all the necessary documentation associated with the transaction and your funds have cleared in our client account, we will quote you a rate for your transfer. The converted funds will be credited to your nominated overseas account within one to three working days.
3. What are the minimum and maximum amounts that can be transferred?
Our minimum transfer amount is R100,000 when you transfer money online with us. As a South African ID book holder, you are able to remit R1 million under your discretionary allowance and an additional R10 million per year with the aid of a foreign tax clearance certificate. .
If you are a South African non-resident (this means that you have never been issued with a South African ID book or ID number) there is no limit to the funds that you may remit from South Africa, provided that you can prove the source of the funds. Please contact us on firstname.lastname@example.org for more information.
There are certain benefits to sending larger amounts. To find out more about the benefits of sending larger amounts pop us an email, or give us a call, and tell us how much you’d like to send, and we’ll walk you through the currency conversion process.
4. What methods of payment can I use to transfer the funds to your account?
We accept internet banking payments. You will be supplied with a bank account in your own name to which you will transfer the funds. Proof of payment must be emailed to us, so we can allocate your funds for transfer.Get in touch
5. What happens when I use internet banking as my preferred payment method?
If you have chosen internet banking as your preferred payment method to transfer money abroad, you will need to complete two stages to effect a transfer. Firstly, you will need to upload your transfer instruction onto our website. This tells us the amount of money, destination to which and date on which you want the funds to be sent. After this, you will have to log in to your internet banking account and transfer the requested amount to the account we have opened for you, using your name and surname as the payment reference.
The appropriate details for your account will appear when you upload your transfer request on our website. We will also email you a confirmation of your account.
6. How can I be sure that my funds will be correctly allocated?
If you are using internet banking, it is imperative that you ensure that your funds will clear under your name and surname. Please notify us on email@example.com once you have made the payment. Following these guidelines will decrease the likelihood of a delay.
7. Are there any hidden charges or receiving bank charges?
Not at all. Our transfers carry a small swift fee of R250. When the funds clear in your recipient account the intermediary and receiving bank may charge a bank fee to depending on whom you bank with and this is generally £15, alternatively we charge R200 to ensure all potential receiving and intermediary charges are covered upfront.
8. What are the requirements of a registered Money Service Business?
The law requires us to monitor any unusual or suspicious transactions of any size taking place where we have reason to believe the money is derived from illegal activity. We will report any suspicious international money transfers to the authorities.
The law also requires us to keep full records of all transactions, together with copies of identification provided. We are unable to process any transaction where this information is withheld. Proof of address and proof of funds may be required in certain cases – please see our “know your customer” guidelines for more information.
9. How secure is the site?
Our site uses Secure Socket Layer (SSL) 128-bit encryption to protect your transaction details. This 128-bit encryption is the latest and strongest data encryption technique commercially available for securing information between you, our client, and our website. SSL works by encrypting/scrambling data from our website to your computer.
The data is encrypted on our web server and can only be decrypted/unscrambled by the person with the correct decrypt/unscramble key. You can visually verify our site’s use of SSL in two places: The "s" in "https" in the site’s web address and by the padlock on the left-hand side of the address bar.