As an expat South African living overseas, you might feel disconnected from your financial assets back home, particularly your retirement savings. Fortunately, Fin Select NZ specializes in helping South Africans unlock the value of their retirement funds, including retirement annuities, preservation funds, and provident funds. This guide delves into how you can access your South African pension early, the processes involved, and the benefits of working with Fin Select NZ.
Understanding Policy Surrenders
What Are Policy Surrenders? Policy surrenders allow you to cash in your South African retirement policies before their maturity. Depending on your specific circumstances, including the type of policy, its value, and your age, you may be able to access these funds without completing the full tax emigration process.
Eligibility for Policy Surrenders:
- Preservation Funds: If you haven’t taken a prior withdrawal, you can surrender your preservation funds, however, the rules have changed for Preservation funds. Preservation funds now fall under the same rules as Retirement annuities (RA’s).
- Retirement Annuities (RAs): If your policy have matured (you 55 or older) and the policy value is below R247,500, you may qualify to surrender your RA without tax emigration.
Fin Select NZ offers free assessments and personalized guidance to determine your eligibility and navigate the complexities of policy surrenders.
The Policy Surrender Process
Accessing your South African pension early involves four key steps, all managed by Fin Select NZ:
- Assessment & Quote: Fin Select NZ sends you a consent form, allowing their authorized financial services provider to gather details about your investments. A tailored quote is prepared based on your circumstances, including the complexity of your investments and tax implications.
- Acceptance: After accepting the quote, you complete an online emigration questionnaire. This helps compile the required paperwork and supporting documents.
- Application: Once all forms and documents are submitted, Fin Select NZ processes your application through the relevant authorities and insurance providers to release your funds.
- Completion: The funds are transferred to your nominated bank account. You will receive all the relevant documentation confirming the process is complete.
Benefits of Working with Fin Select NZ
- Trusted Experts: Fin Select NZ is registered with the Financial Sector Conduct Authority (FSCA) in South Africa and adheres to international compliance standards.
- Comprehensive Services: From financial emigration to investment advice, Fin Select NZ provides a one-stop solution for all your financial needs as an expat.
- Tax Efficiency: Their tax specialists ensure you minimize liabilities while maximizing returns on your retirement savings.
- Easy Withdrawals: Fin Select NZ’s strong relationships with South African insurance providers streamline fund withdrawal processes, making them quicker and hassle-free.
- Currency Transfers: With competitive forex rates, Fin Select NZ ensures you get the most value when transferring funds abroad.
- Holistic Investment Guidance: Beyond fund withdrawals, Fin Select NZ helps you reinvest your savings in global markets, securing your financial future and helping you build wealth for the long term.
Early Access to Retirement Funds
Retirement funds are a significant part of many South Africans’ investment strategies. However, accessing these funds early—before age 55. Here’s how you can access your retirement funds under different scenarios:
- Early Withdrawals: Retirement Annuities: Policies valued below R15,000 can be accessed in full. Ill health may also qualify you for early retirement withdrawals.
- Retirement (Age 55 and Above): Provident Preservation Funds: Full cash lump sum withdrawals are allowed. Pension Preservation Funds/RAs: Up to one-third of the investment can be withdrawn as a cash lump sum, with the remaining two-thirds used to purchase a life or living annuity.
Important Considerations:
- Tax Implications: Working with Fin Select NZ ensures that these are calculated accurately and reduced where possible.
- Financial Goals: Before withdrawing, assess whether accessing your funds aligns with your long-term financial objectives.
Financial Emigration (Tax Emigration): The Key to Unlocking Your Pension
Financial emigration involves formally changing your residency tax status with the South African Revenue Service (SARS) and the South African Reserve Bank (SARB). This process allows you to withdraw your retirement funds and transfer them overseas.
Steps Involved in Financial Emigration:
- Assessment: Fin Select NZ assesses your financial assets and evaluates tax implications.
- Tax Clearance: They apply for an Application for International Tax (AIT) clearance with SARS.
- Bank Account Setup: A South African emigrant bank account is opened to receive your funds.
- Withdrawal & Transfer: Retirement policies are liquidated, and proceeds are transferred to your international account.
Why Financial Emigration Matters: By completing financial emigration, you align your financial affairs with your new residency, making it easier to manage funds and comply with international tax regulations.
Case Study: Jaco’s Journey
Jaco emigrated to Australia but left retirement policies and other assets in South Africa. With Fin Select NZ’s help, he successfully accessed his retirement funds without complications.
How Fin Select NZ Helped Jaco:
- Conducted an assessment to confirm the value of his policies and tax implications.
- Changed his residency status with SARS to non-resident.
- Opened an Emigrant blocked account in South Africa.
- Facilitated fund withdrawals.
- Transferred his retirement proceeds to Australia.
- Ensured future inheritances from South Africa could be easily transferred.
Jaco’s financial affairs are now aligned with his life abroad, securing his family’s future.
Legislative Changes to Retirement Fund Access
Recent legislative amendments have introduced additional hurdles for South Africans accessing retirement funds abroad. Under the 2021 Tax Laws Amendment Bill (TLAB), individuals must prove non-residency for a continuous three-year period before withdrawing funds. This change underscores the importance of completing financial emigration promptly.
Implications of the Amendment:
- Funds may be tied up in South Africa for at least three years.
Frequently Asked Questions (FAQs)
1. Can I keep property in South Africa while completing financial emigration? Yes, financial emigration does not require selling your property. You can retain assets in South Africa while accessing your retirement funds abroad.
2. How long does the financial emigration process take? The timeline varies but typically takes a few months. Fin Select NZ’s streamlined process ensures minimal delays.
3. Are there penalties for withdrawing funds early? No, not if you deal with someone who specializes in the industry. Fin Select NZ helps minimize these penalties through expert tax planning.
4. What documents are required for financial emigration? Commonly required documents include your South African ID or Passport, tax clearance certificate, proof of residency abroad, travel diary, and details of your retirement policies.
5. Can I access my pension without financial emigration? Yes, but only in some cases. Fin Select NZ assesses your eligibility on a case-by-case basis at no cost to you.
Why Act Now?
Accessing your retirement funds can be a lengthy process involving legal, tax, and financial considerations. Fin Select NZ’s expertise ensures a seamless experience, helping you:
- Expedite the financial emigration process.
- Minimize tax liabilities.
- Secure your financial future overseas.
By taking proactive steps, you ensure that your hard-earned retirement savings are accessible when you need them most. Don’t let bureaucracy and tax complexities hold you back. Contact Fin Select NZ today for a free assessment and personalized plan to unlock the value of your South African pension.
Closing Thoughts
Navigating the complexities of accessing South African retirement funds as an expat can feel overwhelming, but with Fin Select NZ’s support, the process becomes straightforward and stress-free. Whether you’re considering financial emigration or looking for ways to access your funds early, their expertise ensures you receive the best possible outcome. Don’t leave your retirement savings untapped. Reach out to Fin Select NZ and take control of your financial future today.navigate this challenging process successfully while ensuring full compliance and optimal outcomes for your financial future.
Contact Information
Ready to start your journey? Let Fin Select help with your tax emigration and transfers by completing the form below:
