Financial vs Tax Emigration

Prior to a law change, South Africans would look to financially emigrate in order to get access to their retirement annuities and inheritances. The law of this all changed in March 2021. Now, expat South Africans earning income abroad may be subject to paying tax in South Africa. In addition, the tax emigration process needs to be followed otherwise there may be penalties.

Financial emigration and how it has changed.

Previously, the South African Reserve Bank (SARB) was the authority the South African expats could declare themselves as non-residents to. This enables expats to transfer and access their retirement annuities and pensions abroad. Now, the authority determining tax residency is the South African Revenue Service (SARS).

How do you access your retirement annuity abroad?

You are only able to access your retirement annuity if you can prove that you have been a non-tax resident in South Africa for three years. This is also known as the three-year rule.