Information regarding the formal emigration process

1. FORMAL EMIGRATION
INFORMATION REGARDING THE FORMAL EMIGRATION PROCESS
GUIDE
Foreign Exchange
Incompass Pty Ltd
An Authorised Financial Services Provider (License No: 13011)
4th Floor | 71 Loop Street | Cape Town 8001 | South Africa
Tel: +27 (0) 21 424 2936 | Fax: +27 (0) 86 568 2086 | E-mail: info@incompass.co.za

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Leaving the country
Taking up another citizenship
Having a “no tax status” with SARS in SA
Paying tax in another country
Not being present in SA for a couple of
years (even after 5 years)
Not having a bank account in SA anymore
Not having any assets in SA anymore
FORMAL EMIGRATION
WHAT IS FORMAL EMIGRATION?
.
WHAT IS NOT CONSIDERED
FORMAL EMIGRATION?
WHO SHOULD FORMALLY
EMIGRATE?
Most South Africans that left South Africa and
are still leaving, purchase a plane ticket, board
an aeroplane and try to build a new life on
the other side. They might take up citizenship
or permanent residency in another country
and decide to not come back at all, or at least
not for a very long time.
Talking to these South Africans abroad (some
of them already enjoying the overseas
lifestyle for more than 20 years), they are all
pretty sure that they have fully emigrated
from South Africa.
But have they really?
The formal emigration process is a lot more
detailed than just climbing on a plane and
even more complex than receiving a new
passport (and sometimes forgetting about
the old South African one, which might have
expired in the drawer somewhere).
Formal emigration is a process that is set in
motion via the SA Reserve Bank. It requires
you to submit forms and documents via your
South African bank, in order to be submitted
to the SA Reserve Bank. The outcome of this
will mean your banking status in SA changes
from having a “normal” SA resident status to
a non-resident or formal emigrated status.
Your new status will then reflect by means of
a new bank account which would reflect your
new residency status.
Unless you set this process in motion and
received a confirmation letter about your new
status, it is very unlikely that you have
formally emigrated from SA.
There are pros and cons to formal emigration,
and it is a process that should be carefully
considered and discussed with an expert first
before actually taking this step.
It is difficult to reverse the formal emigration
once committed to it, therefore, clients that
are not sure yet that they are going to stay
living overseas and that might want to return
at one stage are not the right candidates for a
formal emigration.
The good news is that you do not need to be
present in SA in order to formally emigrate,
you can therefore leave the country,
experience the lifestyle overseas and once
you have made up your mind after a couple
of years that you do not want to return, you
can still formally emigrate. You therefore need
to be sure that you are going to live outside
of SA, and you need to have obtained
citizenship (or permanent residency) in the
country you wish to stay before you can
consider formal emigration.

3. Typical formal emigration cases are:
Clients that do not have any assets left in SA
Clients that wish to get their retirement
annuity paid out before reaching
retirement age
Clients that can expect inheritance from
SA, to a greater value than ZAR 10 million
Clients that wish to “cut all ties” with SA
Clients that do not have a SA ID book
anymore and cannot obtain a new one
After your formal emigration, you will only be
able to operate one so called “blocked ZAR
account”, with one bank only.
All of your remaining assets in SA will be blocked
and will be placed under the control of your bank.
You can take out your Foreign Capital
allowance of ZAR 10 million per calendar year
(just as any resident can).
You can take out your ZAR 1 million allowance
per calendar year (just as any SA resident can).
You can export household and personal goods,
motor vehicles, caravans etc within an overall
insured value of ZAR 2 million.
Your tax status at SARS might change,
additionally this might trigger capital gains tax
on assets.
As a non-resident from an exchange control
perspective, you can only obtain finance in SA
according to non-resident rules after your
emigration.
Formal emigration does not influence your
SA citizenship, you will not lose your
SA passport.
WHY WOULD I
FORMALLY EMIGRATE?
EFFECTS OF FORMAL
EMIGRATION
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4. Many of the South Africans living abroad, that have not
formally emigrated, are regarded as South Africans living
temporarily abroad. They are allowed to send money out of
SA using their two basic annual allowances of ZAR 1 million
and ZAR 10 million.
We assist with all necessary information and SA Exchange Control advice regarding
the formal emigration process
We assist with all necessary information and SA Exchange Control advice regarding the formal
emigration process
We obtain all necessary documents from the client
We apply for the tax clearance certificate for formal emigration
We hand in everything to the SA Reserve Bank
We open a blocked ZAR account for the client
We facilitate the money transfer to client’s offshore bank account
Clients are benefiting from our excellent exchange rates and no admin fee on
the actual money transfer
Incompass charges an administration fee of ZAR 10 000 (vat excl) for the formal emigration
process. However, only a 50% upfront deposit is needed to initiate the process and the balance
can be settled upon completion of the formal emigration process.
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DO I HAVE TO FORMALLY
EMIGRATE?
PROCESS
CLIENT REGISTRATION
CLIENT DOCUMENTATION
TAX CLEARANCE
SA RESERVE BANK
BLOCKED ZAR ACCOUNT
MONEY TRANSFER
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