JOHANESSBURG – Exchange Control is a set of rules which allow countries to control the movement of money in and out of the country. These rules are given by South African Reserve Bank (SARB). A resident of South Africa is entitled with the transfer of R11 million annually.
Exchange Control regulations are applicable for transactions performed while travelling, investing, emigrating, importing and exporting or returning to SA. All foreign currency transactions have to be declared to SARB.
There are two ways by which currency can be transferred from the country. One is the discretionary allowance of R1 million and foreign investment allowance of R10 million. This adds up to R11 million annually for any citizen of South Africa.
The R1 million Discretionary allowance can be transferred without any taxes. It doesn’t require a tax clearance certificate by SARB. This amount can either be sent in a lump sum or staggered payments throughout the year.
Residents of South Africa settled in foreign countries, who haven’t financially emigrated, have an additional allowance of R10 million on the top of R1 million. This allowance however is not as easy to have as Discretionary allowance.
This allowance requires a Tax Clearance Certificate (TCC ) for foreign investments from South African Revenue Service (SARS). This certificate is valid for 12 months and confirms that all your taxes are in order. A professional can easily get a TCC, if requested.
But don’t fret if the amount you want to transfer is more than R11 million. A Letter of Compliance has to issued by SARS that should be approved by SARB for such transfers. This process is a bit more complicated than the previous ones, but it’s nothing a foreign exchange provider can’t do.
Transfer of currency is not as tough a process as some assume it to be. The right resources and the knowledge of the required certificates can easily transfer funds from South Africa.