Financial Planning for Expats Moving to South Africa: What You Need to Know

Moving to South Africa requires careful financial planning and organisation. Structuring your finances properly will help you avoid unexpected pitfalls and ensure a smooth transition. The importance of getting advice to manage your finances cannot be emphasised enough.

Relocating to South Africa (short term or longer term) can be a significant life change, filled with excitement, as well as a fair share of challenges. Comprehensive planning is crucial, and one of the most important steps to consider that must not be overlooked is financial planning. 

Managing your finances while transitioning to life in South Africa should be carefully thought out, especially when it comes to pensions, tax-efficient investment structures, as well as what assets to hold within South Africa verses what to hold (or keep) offshore. Having the right partners in place can make all the difference, and this blog explores the essential aspects of what you really need to be thinking about in terms of your financial planning. The implications of not doing so can be costly - don’t leave this aspect of your move until it’s too late. 

South Africa can actually be one of the most tax efficient jurisdictions in the world – if you know what you’re doing and have specialised guidance on how to structure your assets correctly. If you don’t, it can be one of the most tax costly and financially inefficient jurisdictions in the world. With high taxation, rampant inflation, and a currency that is depreciating at a tremendous rate, having specialist guidance on this aspect of your move is crucial. 

As an expat moving to South Africa (or a South African returning), you may have pensions and investments held abroad, and ensuring these are optimised is essential. There is a lot to be said for “live where it’s warm but invest where it’s cold”, but you need to get specialised advice in order to protect yourself and your family. Learn from those who have done this journey ahead of you. There are many of us!

The South African Revenue Service (SARS) can be your dearest friend or your worst enemy, depending on if you know exactly where you are tax resident and that you have structured your assets in the most tax efficient way. It’s not always as clear cut as you think – and local South African Advisors won’t tell you everything that you need to know. What many of us have found is that there are many things that you don’t realise, until you are informed of them. Many people leave this aspect of their move until it’s too late and find themselves exposed to huge tax bills that could easily have been avoided. 

Some of the key financial considerations you might have found yourself thinking about include:

• I’m thinking of buying a property in South Africa?

• I am thinking whether to sell my property abroad?

• Is it worth setting up a local South African pension?

• How do they work?

• Should I have my salary paid locally or offshore?

• Can I create a business offshore and work “remotely”? (Perhaps I could then avoid the tax man...)

• What about my UK / offshore pensions and UK State Pension?

• Can I contribute to my pension while living abroad?

• What are the implications on inheritance tax, capital gains tax, Estate Duty, income tax…?

• Should I keep my bank account open in my home country?

• What about my Insurance policies to ensure they cover South Africa, and any specific risks associated with living abroad?

• What about your investment properties aboard, and any income you may be receiving?

• Will I be taxed in both jurisdictions?

• How moving to South Africa and earning in ZAR might affect my long-term earning potential and retirement plans?

• Do I need to file a tax return if I am not working yet?

• I have a will in the UK / my home country, but does that cover me here or do I need a South African will?

• I haven’t thought about an Exit Strategy for scenarios where I may need to return to my home country, and how my finances will be impacted by such a move back? 

These are just a fraction of some questions that you might have rummaging around in your mind, and there are many more. 

Our Partnership with Holborn

At Cape Relocators, we pride ourselves on helping our expat clients get the answers, support, and guidance they need when moving to Cape Town, which is why we partner with the best experts.

We are proud to collaborate with Holborn Assets, a trusted financial advisory firm specialising in wealth management, tax planning, and financial solutions for expatriates. This partnership enables us to provide expert guidance on South African tax structures, retirement planning, offshore investments, and financial compliance; ensuring a seamless transition to life in Cape Town. With Holborn’s deep expertise and personalised approach, our clients receive tailored financial strategies that align with their relocation goals, offering peace of mind and long-term financial security. Through this collaboration, we equip expats with the confidence and clarity they need to navigate South Africa’s financial landscape, ensuring a secure and well-planned future in their new home.

Mark McAllister is a globally renowned financial planning expert and British expat himself who specialises in providing personalised financial advice tailored to your financial needs.

Whether you are looking to move pensions into more tax-efficient structures, manage foreign investments, need assistance with pension transfers, setting up a local or offshore bank account, or consolidating your financial assets for better returns, let Mark guide you every step of the way.

His personalised approach ensures that your money is working for you, no matter where you are in the world. 

His extensive experience in cross-border tax-efficient strategies and long-term financial planning ensures you can make the most of your specific financial situation. He is particularly skilled in the area of UK pensions. Thanks to tax treaties between South Africa and the UK, British expats can often retain their pensions in a highly tax-efficient manner, optimising income and protecting long-term financial stability for both you and your family. Mark provides comprehensive advice on pension consolidation, tax implications, asset protection, and every conversation is specifically focused on your specific needs and circumstances. He assists with setting up offshore structures, restructuring current offshore assets, and planning intergenerational wealth to ensure that your family’s financial future is secured. Mark will ensure that financial matters are considered during each phase of the relocation and ensuring that your financial structure is sound for your new life in South Africa. 

His financial advice is tailored to making sure you maximise tax efficiency, safeguard your assets, and optimise your investment strategies. His deep understanding of expatriate financial planning as well as South Africans returning to South Africa ensures that your relocation goes incredibly smoothly logistically as well as financially.

However much or little you feel that you have in terms of financial wealth – it all matters. Mark will work alongside you to ensure you have the right bank accounts, investment vehicles, and pension plans to align with your long-term financial goals. His experience with the intricacies of cross border financial management guarantees that your move to South Africa is secure and financially advantageous.

So if you’re planning to move to South Africa (either for a year or two, or permanently) or if you’re already here this is an area that you haven’t had time to focus on yet, Mark and his team will sit with you for a personalised complementary financial consultation. He will talk through all your worldwide assets and let you know your status and your options. The very least you will come out with is a lot of knowledge about your situation to think about. Arm yourself with the facts, so that you can make informed decisions. And remember that not taking action is also an action. 

We have both used Mark and his team for our own personal financial planning in our relocation here and can wholeheartedly vouch for his services. Proper planning is the key to a smooth and successful relocation, and with the right support, you can start this new chapter with confidence and ensure that you don’t fall into the same traps that so many expats (and South Africans returning to South Africa) have fallen into before. Benefit from Mark’s expertise with comprehensive, integrated, and objective advice and how he can help you meet your objectives.

Contact Cape Relocators today to arrange an obligation-free consultation to discuss your current situation and find out the true facts regarding your current financial situation.

📩 Get in touch today! Let’s make Cape Town feel like home for you & your family. 💛🏡

📧 Email: info@caperelocators.com

🌍 Visit: www.caperelocators.com

💬 WhatsApp: +44 (0) 7736 040292

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