South African Exchange Control Regulations dictate how much and under what circumstance you as an individual may transfer money offshore. An individual of the age of 18 years or older may transfer a total of R11 million each calendar year (from January to December) out of South Africa for any legal purpose (which includes travel, study, investment offshore, monetary gifts, and maintenance) using your allowances:
- R1 million single discretionary allowance (no tax compliance status PIN Letter required)
- R10 million foreign investment allowance (tax compliance status PIN Letter required)
Where individuals acquire assets situated in eSwatini, Lesotho, Namibia, and South Africa (the Common Monetary Area (“CMA”)), through an offshore structure, i.e. where you acquire authorised foreign assets that hold assets in the CMA or invest in the CMA thereby creating a loop structure, the investment must be reported to an Authorised Dealer.
As an individual, you can borrow money offshore. This inward foreign loan must be approved by an Authorised Dealer, subject to specific criteria and the Authorised Dealer recording the loan through the Loan Reporting System.
Failure to adhere to these regulations may give rise to adverse consequences.