Terms Every South African Abroad Should Know

Glossary

Whether you’re selling property, moving money offshore, sorting out your tax status or drawing a retirement annuity from abroad, South African admin has a vocabulary all its own. This glossary unpacks the terms non-residents come across most, in plain English. Bookmark it and refer back whenever a form or adviser mentions something unfamiliar.

Tax & Residency

  • Tax resident — Someone SARS regards as living in South Africa for tax purposes, and therefore taxable on their worldwide income. You can live abroad for years and still be a tax resident — leaving the country doesn’t change your status; only a formal process does.
  • Non-resident (for tax) — Someone who has formally ceased South African tax residency. Non-residents are taxed only on South African-source income, such as local rental income or gains on SA property.
  • Tax emigration — The everyday term for formally ceasing your South African tax residency with SARS. It affects your tax status only — not your citizenship or passport.
  • Ordinarily resident test — SARS’s primary residency test: where is your “real home”, the place you’d naturally return to? It weighs your family’s location, property, work and social ties.
  • Physical presence test — SARS’s day-counting residency test, based on how many days you’ve spent in South Africa over the current and five previous tax years. Spending 330 consecutive days outside SA breaks residency under this test.
  • Double Taxation Agreement (DTA) — A treaty between South Africa and another country that decides which country gets taxing rights when both could tax the same income — preventing you from being taxed twice.

Moving Money Offshore

  • Exchange control — South Africa’s rules, administered by the Reserve Bank, governing how money moves out of the country. Every offshore transfer happens within this framework.
  • SARB — The South African Reserve Bank, whose Financial Surveillance Department oversees exchange control.
  • Authorised dealer — A bank licensed by the SARB to process foreign exchange transactions. All offshore transfers must go through one.
  • Single Discretionary Allowance (SDA) — The amount a South African resident can send offshore each calendar year for any legal purpose without tax clearance — increased from R1 million to R2 million in the 2026 Budget. It resets every January and unused amounts don’t roll over.
  • Foreign Investment Allowance (FIA) — Also called the foreign capital allowance: an additional R10 million per person per calendar year for offshore transfers, requiring SARS tax clearance (an AIT PIN). Amounts above the combined allowances need special SARB approval.
  • Approval for International Transfer (AIT) — The SARS tax clearance process for larger offshore transfers (and for non-residents moving capital abroad). It verifies your tax compliance and the source of your funds, and issues a PIN your bank uses to process the transfer.
  • Forex spread — The margin between the exchange rate a provider gives you and the real interbank rate. On large transfers, a smaller spread can save you tens of thousands of rand.

Retirement & Investments

  • Retirement annuity (RA) — A personal retirement savings product. Since 2021, you may only withdraw the full value once you’ve been a non-resident for three uninterrupted years — the so-called three-year rule.
  • Preservation fund — A fund holding retirement savings transferred from a previous employer’s pension or provident fund. The same three-year rule applies to full withdrawal after emigration.
  • Two-pot system — South Africa’s retirement reform (from September 2024) splitting contributions into a “savings pot” (limited annual access) and a “retirement pot” (locked until retirement). It changes what expats can access and when.
  • Living annuity — A post-retirement investment paying you a regular income. Non-residents can usually continue drawing it abroad, but cannot cash out the capital.
  • Lump sum withdrawal tax — The SARS tax tables applied when you cash out retirement savings — often the single biggest cost of withdrawing your RA after emigration.
  • Situs assets — Assets legally located in a country (like SA property or shares) that remain exposed to that country’s taxes — relevant for estate planning across borders.
  • Estate duty — South African “inheritance tax” of 20–25% on the portion of an estate above R3.5 million. SA assets may remain subject to it even after you emigrate — a reason to keep both a South African and a foreign will.

General

  • SARS — The South African Revenue Service, the tax authority.
  • eFiling — SARS’s online platform (www.sarsefiling.co.za) where returns are filed, the RAV01 is submitted and TCS/AIT PINs are requested.
  • Expat — Shorthand for a South African living abroad — whether temporarily on assignment or permanently emigrated.
  • Common Monetary Area (CMA) — South Africa, Namibia, Lesotho and eSwatini, which share aligned currency arrangements. Transfers within the CMA are treated differently from “offshore” transfers.
  • Certificate of tax residence — A letter from your new country’s revenue authority (e.g. HMRC, ATO) confirming you’re a tax resident there — key evidence in tax emigration and DTA claims.
  • Apostille — An international certificate (under the Hague Convention) authenticating a document for use in another country — commonly needed for powers of attorney signed abroad.
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