South African exchange control

South African Exchange Control

South African Exchange Control

For many individuals South African exchange control may well be a new topic and something they have not come across before.

It is however of vital importance when transferring money out of South Africa and also, although commonly neglected when doing so, transferring money into South Africa.

The fact is that without compliance with the South African exchange control regulations your ability to do an international transfer may well be impeded and at worst prevented.

What is South African exchange control?

South African exchange control is a regulation that controls the flow of money/ assets in and out of South Africa and is governed by the South African reserve bank.

One of the main aspects of South African exchange control is that it places limits and processes on how much and in what circumstances individuals and companies can transfer money out of South Africa.

How does it impact individuals

Individuals transferring money out of South Africa will feel the most impact as they have to either adhere to:

  • prescribed allowances
  • obtain reserve bank approval
  • be repatriating money they brought into South Africa
  • or be a non resident of South Africa.

You can view more information here on how to transfer to transfer money out of South Africa.

Does it matter how you transfer funds into South Africa?

In short the answer is yes. Similar to making a cake, the cake will only be as good as the ingredients put into the mixture before baking it.

If funds are not transferred to South Africa in the correct manner and with the correct procedures and paperwork trail, repatriating them at a later date can be troublesome and in worst cases impossible.

You should ensure that you deal with an organisation that is able to help with you with both transferring funds in and out of South Africa. That it is registered with the reserve bank of South Africa and is well versed with South African exchange control regulations.

What if I am a non resident wishing to transfer funds out of South Africa?

Once again if you transfer funds to South Africa make sure you deal with an appropriate currency company. For profit and earnings made in South Africa, these can be transferred out of South Africa but it must be proven that such profits or earnings were fairly earned and declared.

What if I am a resident and wish to transfer money out of South Africa?

If you are a South African citizen or permanent residency holder, the good news is the exchange control regulations have been much relaxed in the last few years.

In the first place there is an annual allowance that allows you to transfer 1 million rand per year per adult with no tax clearance required. Further there is an annual 4 million allowance per adult annually but tax clearance must be applied for and granted.

The South African exchange control regulations also allow for various other allowances that can be utilised.

Where can I get the best advice on South African exchange control regulations?

Incompass offer free advice on exchange control regulations with no obligation. Further we are able to provide you with a money transfer service both in and out of South Africa that incurs no service fees and some of the most competitive rates for transferring money.

For expert guidance on South African exchange control regulations contact us now.

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