Many may simply choose not to do so, robbing South Africa not just of money that would otherwise go into the broader economy but of tax revenue too. Having grown a healthy offshore nest egg, for example, someone might use it to build their retirement property or supplement their pension. Grown in more stable international markets, it can then be put to work in the economy. But that money, put to work, is a net positive for South Africa. So, even if an investor wants to legitimately take their money offshore, they’ll struggle to do so. In the investment space, especially, time wasted is money lost. SA tops global ranking in forex trading interest For example, the requirements for taxpayers to list local and foreign assets and liabilities – and allocate a value to each of them – could result in lengthy delays in the AIT being granted (especially when you factor in further verifications from Sars). Instead, the information and documentation required to get an AIT are far more involved and complex than they ought to be. Unfortunately, that isn’t what’s happened. Implemented properly, it could also have simplified the application process for anyone wanting to take money offshore. As South Africa’s greylisting by the Financial Action Task Force (FATF) earlier this year shows, the country clearly needs better oversight on funds entering and leaving the country.Īnd if better alignment between Sars and the Reserve Bank makes it easier to provide that oversight, then so much the better. On its own, that’s not necessarily a bad thing. With an AIT, they can take the same amount out, but the approval requirements have become a great deal more stringent. With this pin, individuals were able to take up to R10m a year out of the country without restrictions (in addition to the R1m that can be taken out without any prior approvals). Those moving money across for investment purposes, meanwhile, needed to obtain a “Foreign Investment Allowance” (FIA) TCS Pin. Previously, someone wanting to move money offshore for emigration purposes had to obtain an emigration-specific Tax Compliance Status (TCS) Pin from Sars.
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