28-10-2021 07:15:55 (GMT +02:00) Pretoria / Cape Town, South Africa

The new tax and emigration change South Africans should know about
29. Aug. 2020 Biz Tech

However, it was announced in the 2020 Budget Review that the concept of emigration for exchange control purposes will be phased out.
“As a result, the requirement of formal emigration will be removed and a new requirement for the withdrawal of lump-sum benefits from these retirement funds is proposed, effective from 1 March 2021 ` namely, that the person is not a resident (i.e. for tax purposes) for an uninterrupted period of three years or longer.
“It appears that this requirement is intended to apply to three consecutive tax years, although the amendment refers simply to years.”
Changes
Jean du Toit, head of Tax Technical at Tax Consulting SA, said that under the current rules taxpayers can withdraw their retirement funds prior to their retirement date, upon emigration for exchange control purposes.
This emigration process must be recognised by the South African Reserve Bank in a process known as ‘financial emigration’, he said.
Du Toit said that under the new bill, reference to the emigration process is substituted with a new test that requires a person to prove they have been non-resident for tax purposes for an unbroken period of at least three years.
“This new test will apply from 1 March 2021. How this must be proved other than ‘financial emigration’ remains unclear at this stage.
“Practically, after the effective date, your retirement benefits will be locked in South Africa



 

for at least three years. The proposed amendment signals a big policy shift from a fiscal perspective, but this is one piece to a bigger puzzle that should have those who seek to emigrate on high alert.”
Based on daily interaction with employers, executives and expatriates, Du Toit said that the following groups of people should give this change careful consideration:
• Does it remain prudent for South African executives to keep taking a tax break and maximising their South African approved retirement savings?
• Where you have large retirement savings, the opportunity will soon be over to make best possible investment decisions ` soon some will go towards cheaper access to finance.
• South Africans looking to leave in the next couple of years will benefit from at least expediting their process on retirement savings, being they are locked in for 3 years.
• South Africans who have already left, but who have not yet done financial emigration, should consider doing this within the next 6 months before the window closes.
• Those who have already financially emigrated, but left investments behind, should reconsider their position.
• South Africans with children or other foreign beneficiaries, should relook at their investments and to align with this new landscape

www.samigration.com V.5266

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  •    If you wish to secure your spot in the class of 2022 at one of the twenty-six South African higher education institutions, you have to start working on starting your application process. It’s important to note that before you make any application, consider different factors. And those include the environment you see yourself living and working comfortably in, the location, (public) transportation facilities and routes, accommodation, daily economic costs, financing for studies via institutional bursaries, and the general style of the learning institution you want to attend. NB: application dates may differ and/or change due to the COVID-19 pandemic. The institutions hold the privilege to revise the dates published in order to match what has been a constantly changing learning environment since the pandemic began. Nelson Mandela University (NMU)... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...
  •    Long queues and systems that are constantly offline have long plagued Home Affairs offices. It`s affected many people. Home Affairs says it will be using this weekend to resolve issues just like these. Reporter Mawande Kheswa has more. Courtesy #DStv403 There are over 400,000 uncollected IDs at Home Affairs offices nationwide.... Read more...

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