Non-resident South African and SA Investments

RVQ

Expert Member
Joined
Apr 30, 2007
Messages
1,652
I relocated overseas and for the entire 2019/2020 tax year I was outside of SA. While I may have the opportunity to take up permanent residence and plan to, only time will tell what will happen.

I only have a PP, RA, TFSA, Shares and Cash in FNB Money Maximiser in SA. I know my PP and RA is pretty much locked in unless I formally immigrate. I'm finding it difficult to decide what to do with my EE TFSA and Shares:
  • Should I sell all the shares this tax year and move money over during 2020/2021 tax year?
  • My TFSA is actually doing fairly well, I used it to hedge against the Rand which worked out well and ideally I'd like to max out again this tax year as a safety should I return to SA but what are the implications of a non-resident holding a TFSA account? Should I leave as is or get rid of it?
 

phiber

Expert Member
Joined
Dec 7, 2005
Messages
4,260
Do you plan to do a non-resident filing for 2019-2020? Be prepared to be audited, I am currently going through it. Nothing untoward, just have the relevant paperwork on hand. Waiting for my process to close out now.

I worked corporate mostly, and they have retirement funds not retirement annuities. I managed to cash those out and pay the tax on them. I do have 1 RA which is only accessible on financial emigration (not necessary to immigrate anywhere). Not sure what you mean by PP, but if it is a Pension Preservation fund, that it is likely fair game to cash out and pay the tax now.

I sold my shares but still holding my mutual funds. I move my money as and when I need it, and if I see a good opportunity in the rand. Not sure non-residents qualify for Tax Free accounts, I closed mine, trying to reduce the amount of admin I have. Speak to a tax specialist of call SARS on this. They do ask you to declare TFSAs on your return, so I recommend you figure this out before you do a non-resident filing.
 

RVQ

Expert Member
Joined
Apr 30, 2007
Messages
1,652
Do you plan to do a non-resident filing for 2019-2020? Be prepared to be audited, I am currently going through it. Nothing untoward, just have the relevant paperwork on hand. Waiting for my process to close out now.
Thanks for the heads up, is there anything over and above the usual paperwork? I wont have IRP5, Med Aid or Retirement Contributions in SA, only expecting IT3B/C and Dividend Statements for 19/20. I'm thinking of getting a Certificate of Residence just in case.

I worked corporate mostly, and they have retirement funds not retirement annuities. I managed to cash those out and pay the tax on them. I do have 1 RA which is only accessible on financial emigration (not necessary to immigrate anywhere). Not sure what you mean by PP, but if it is a Pension Preservation fund, that it is likely fair game to cash out and pay the tax now.
Ah! I was under the impression that the Pension Preservation is not accessible until retirement, I see I can get access to it now also.

I sold my shares but still holding my mutual funds. I move my money as and when I need it, and if I see a good opportunity in the rand. Not sure non-residents qualify for Tax Free accounts, I closed mine, trying to reduce the amount of admin I have. Speak to a tax specialist of call SARS on this. They do ask you to declare TFSAs on your return, so I recommend you figure this out before you do a non-resident filing.
I'm leaning to selling my shares as I'm now seriously considering property this side due to low interest rates and high cost of rentals.
The TFSA is still the big unanswered question with no one seemingly having a clear answer apart from do not contribute this tax year.
 

phiber

Expert Member
Joined
Dec 7, 2005
Messages
4,260
They sent me the usual 'submit any of these documents that you may have' letter that anyone who gets audit has to submit. I left middle of a year, so I declared non-resident for that year, though I had an IRP5 etc. It might have complicated things a little for me.

The benefits of a TFSA are pretty minimal, so I got out of it due to the complexity. ETFs and stocks are tax free in a lot of countries, so check the local regulation of where you are living. Out of interest, where are you that property is a decent investment? I am in Singapore, and its impossible to buy here, I wouldn't mind looking abroad for an investment.
 

RVQ

Expert Member
Joined
Apr 30, 2007
Messages
1,652
Out of interest, where are you that property is a decent investment? I am in Singapore, and its impossible to buy here, I wouldn't mind looking abroad for an investment.
UK
 

RVQ

Expert Member
Joined
Apr 30, 2007
Messages
1,652
How do you feel about the property market direction post Brexit? No doubt if it's a primary residence it may be better to own regardless.
BREXIT charged the market a little, so there's a spike upwards in prices but it's expected to stabilise with a bit of uncertainty leading towards the end of the year due to pending details on the actual deal but it is looking good in the long term especially for primary residence. Rentals is a mixed bag due to tax/legislation/tenants leading to a less friendly buy-to-rent market.
 
Top