Banking, Money and Taxes in South Africa

The banking system in South Africa is sophisticated and online banking is standard. Major banks include ABSA (owned by Barclays Bank), First National Bank, Standard Bank and Nedbank. Private banks generally offer a slicker service and more professional advice and include Investec and Rand Merchant Bank (RMB). It is relatively easy to open a bank account if you are over 18, can provide a proof of ID (usually a passport) and proof of address in South Africa.

 

Visa and Mastercard are widely accepted in South Africa and ATMs are plentiful. Many foreigners living in South Africa keep their money in a foreign account and draw on it with a debit or credit card. South Africa has currency control restrictions which your bank should explain. All money transferred into South Africa can be repatriated, so it is important to keep a record of transactions.

 

For taxation purposes, it is usually more favourable for expatriates to remain as non-residents in South Africa. Due to the introduction of capital gains tax in 2001, any capital assets can be taxed as long as an expatriate is regarded as a resident, even if the assets are situated overseas and remain unsold. Residents are taxed on their worldwide income, whereas non-residents are only taxed on their South African based income. This includes taxation on rent from property assets in South Africa, interest from loans used or applied in South Africa, salaries and any compensation for services rendered within the country.

An expatriate that is resident in South Africa for more than 549 days over the preceding three tax years will be taxed on their worldwide income. For the latest advice consult with both a UK and South African accountant.