Investing Offshore Guideline – Basics to keep in mind, this article lays down the basic rules before beginning the journey into Offshore Investing. Beginning at the turn of the 21st century there has been a significant increase in the number of South Africans choosing to invest a part of their capital overseas, aka offshore investing. While it is not the right option for everyone with capital to invest it is proving to be a great boon for many ‘everyday’ South Africans looking for ways to secure themselves and their families a better future.
Why Has Offshore Investing Increased in Popularity so Much?
There are a number of reasons that the idea of offshore investment has become more and more appealing here in South Africa. The first is that there has been a significant relaxation in the rules governing it, rules which used to be rather complex and difficult to navigate as well as financially restrictive.
In 2015 anyone can legally move up to R11 million out of the country on an annual basis. There is a R1 million discretionary allowance, which can be used without needing any permissions or clearance from the South African Revenue Service, and then an additional R10 million allowance for which tax clearance is required.
Essentially, this has meant that many, who already planned to begin a proper personal investment portfolio in order to build towards a goal, whether that goal was retirement, a big ticket purchase or simply greater financial wealth, now have far more investment options open to them. What was once thought of as a practice for the uber rich and/or James Bond villain types only has now become something for everyone, as long as they can afford the ‘buy in’ and ensure they have some solid financial advice.
The Clearance Question
As previously mentioned investing up to R1 million abroad requires no formal clearance from the government’s regulatory bodies at all. Therefore many beginning offshore investors do not even think about such things. Some financial advisors however feel that may be a mistake. They recommend that people serious about even limited offshore investment obtain the additional clearance to invest more as soon as possible ‘just in case’. In case of what? Once in a while, when ‘all of the stars align’ one of those great ‘can’t miss this’ investment opportunities come along and without the proper clearance in place even if you have the money available to take advantage you would not be able to due to regulatory restrictions.
Getting Help
Speaking of financial advisors for the average first time offshore investor they are a must. Being able to move money out of South Africa opens up the world’s many markets to you and these can be very tricky places to navigate. This is not to say than you can – or should – simply hand over all of your cash and let someone else make all of the decisions for you. Offshore investing is something of a skill and you should most certainly be involved so that you can begin to learn it. Just ensure that as you get started you have a trustworthy teacher to guide you.
We hope this article “Investing Offshore Guideline – Basics to keep in mind” has helped answer some of your questions, we are sure you still have more. Simply fill in the online form and request a call back from a Professional Financial Advisor to get all your questions answered more fully.
Offshore Investing 2015