Investing offshore just got easier. Here’s how.

By Suzean Haumann*

In February, the finance minister doubled the single discretionary allowance (SDA) from R1 million to R2 million a year. This is the biggest change to exchange controls in 15 years, yet the true opportunity this presents isn’t clear to everyone.

This is especially true for South Africans thinking: “Great, but I don’t have R2 million lying around”. 

The way to think about this is not as a target, but a ceiling. What the increase actually signals is that it’s much easier to now move money offshore than ever before. And that’s true whether you move R2 million this year or R200,000.

How the SDA works

Every South African taxpayer over 18 can now move R2 million a year offshore without needing a SARS tax clearance PIN.

These funds can be used for offshore investments, travel, gifts to family abroad, or almost anything else. 

This is a conversation that I’ve had with many clients who’ve been investing offshore for years and use their allowance without a second thought. 

The more interesting conversation, though, is with the client who hasn’t moved a rand abroad yet. Not because they don’t understand the case for it, but because it can feel like a really big step.

This fear of the unknown is that much harder to stomach if your investment drops by $1,000, not R1,000. 

Your offshore investment options

The reality is that moving money abroad and investing offshore doesn’t have to be any riskier for the average investor.

For a start, the simplest way to get offshore exposure is to not even go offshore at all. Not directly, anyway. 

There are many funds in which you can pay rands to invest in global markets and international shares. The benefit is that you still get real exposure to international companies and currencies, but all the administration stays local.

Investing directly into offshore markets is the natural next step once you’re ready to externalise money yourself. Your options include offshore unit trusts, global equity funds, ETFs and endowments, held in foreign currency on an international platform. 

This is typically how you can use of your SDA to benefit from the growth of offshore investments. 

Practical considerations

Of course, one of the most useful tools that simplify this process is an offshore bank account. This is the account your money actually moves through, and if you travel regularly or have family studying or working abroad, that will simplify life enormously.

A word on tax and estate planning, because it matters more than people expect. South African tax residents are taxed on worldwide income, so interest, dividends and capital gains earned offshore generally still need to be declared here.

This doesn’t always mean you’ll pay tax in two jurisdictions – especially in countries that have double taxation or foreign tax credit agreements with South Africa. 

It’s important to know that if you earn income working abroad, only the first R1.25 million is exempt under current rules, as long as you meet the day-count requirements. Also, offshore assets might be subject to inheritance rules and estate duties, so it’s worth getting proper advice before, not after, you move money abroad.

One more thing worth saying plainly, since the rand had a strong run in 2025: don’t build your offshore decision around what the currency might do next. A weaker rand flatters offshore returns when converted back, while a stronger one dents them. 

The truth is that it’s practically impossible to predict what the currency is going to do, and that offshore investing is a long-term diversification decision, not a currency trade.

So, the real question isn’t whether you can afford to move R2 million. It’s what amount, if it dropped in value tomorrow, genuinely wouldn’t keep you up at night. Start there. Build your comfort with the currency and the process and decide whether to use more of your allowance next year once you have.

My message to you is this: the door didn’t get harder to walk through, it got wider. You don’t need to fill the frame to walk through it.

* Suzean Haumann, CFP®, is head of Brenthurst Wealth Tyger Valley. suzean@brenthurstwealth.co.za 

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