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It's My Money with Suzean Haumann · Strictly Business

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  You're listening to Strictly Business Podcast with Lindsay Williams.
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  This edition of It's My Money is brought to you by Brenthurst Wealth, your partner
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  for global wealth creation.
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  Welcome to It's My Money.
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  It's My Money is brought to you by Brenthurst Wealth, South Africa's
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  multi-award winning boutique wealth manager.
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  This week I'm speaking to Suzanne Hauman from Brenthurst Wealth because investing
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  offshore, Suzanne, has suddenly got easier.
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  And this was something that crept up on us.
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  It was a surprise from the Reserve Bank.
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  I think.
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  I remember waking up one morning, speaking to someone and they said, I can't speak to
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  you because so many people are phoning me about this new
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  legislation that's come through.
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  Please tell me a bit about it.
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  Morning, Lindsay, and morning, listeners.
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  Thank you.
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  Yes, that was definitely a surprise to us all when in the 2026 budget speech,
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  they actually announced that our SDA, which is your single discretionary
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  allowance, has been increased from one million
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  rand per annum.
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  to two million rand per annum.
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  So basically what that means is that any South African taxpayer over the age of 18
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  can now move two million rand per year offshore and that can basically be used
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  for anything.
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  It's for investments, for travels, gifts to family and stuff like that, payments
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  abroad.
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  Yeah, so that made a huge difference in the lives of the South African taxpayer.
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  Yeah, and it's been doubled.
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  And there are two angles to this from my perspective.
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  The first is the macro angle.
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  It means that South Africa's finances are, compared to previous years, compared to
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  previous budgets, are in a relatively
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  good state that they can allow this to happen.
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  And secondly, it means an awful lot.
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  I mean, some people say, oh, it's just a million.
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  What can you do with a million overseas these days?
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  I can tell you, you can do a lot with a million overseas these days.
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  So it's a very important...
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  ruling that they've introduced.
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  And I think a lot of people must be quite excited about it.
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  No, definitely.
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  We've definitely seen an increase in our investors taking up this opportunity to
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  invest additional 1 million Rand per annum.
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  Because previously you had to apply for an approval for international transfer in the
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  olden days, if I can say it like
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  that, known as the tax clearance.
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  Basically, now they can move 2 million Rand and effectively four million rand per
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  annum
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  between a husband and a spouse so for your average south african investor that is
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  more than enough
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  leeway to invest offshore without having to apply to source for this approval to
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  transfer funds out out of the
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  country tell me how it works do you literally contact your bank and say i've
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  got a million in my current
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  account or in my short-term money market account whatever it is bung it over to my
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  overseas bank, please.
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  Is it as simple as that?
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  Yes, it is very simple to do it.
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  You've got a couple of options that you can do.
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  You can either go through your bank.
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  So a lot of the banks now have this facility, even on your banking app on your
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  phone, to say to convert
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  funds into an offshore account.
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  We call it a FCA, a foreign currency account.
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  So some banks or most of the banks have the option, then you have to have an
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  offshore bank account.
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  Or you can buy dollars and invest it in a dollar investment like an Easy Equities or
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  a direct unit trust or a share
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  portfolio.
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  So the first step would be to open a bank account if you only want to put it in a
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  bank account.
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  If you want to externalize the funds completely for a unit trust investment or
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  share portfolio, then you can contact your
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  financial advisor.
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  Most of the financial advisor companies have someone that deals with this foreign
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  exchange for the clients.
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  Brentis does it in-house for our clients, which gives you this one step and one
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  place that you can basically do everything.
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  We offer you share portfolios, unit trusts, development investments, foreign
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  currency bank accounts.
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  So, yeah, we can do it all for you.
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  So very easy to do.
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  And basically, if it's below your SDA, the whole transaction can be done within a
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  week.
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  Very good.
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  Very progressive and very encouraging all at the same time.
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  And of course, this gives you more choices now.
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  With extra money, you have extra choices.
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  And there are so many things you can do.
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  And you make a point in the article you kindly sent me that you don't have to have
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  money offshore in order to invest offshore because of the
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  funds available on the local market, for example.
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  That's a very important point.
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  In case somebody doesn't have a million lying around, you can invest offshore
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  through different means.
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  That is 100 percent.
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  And that's something that not a lot of South Africans actually are aware of, that
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  we've got what we call feeder
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  funds, which is basically localized funds that will feed directly into an offshore
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  unit trust fund.
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  So your funds, your money will never leave South Africa in inverted commas in the
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  fact that you will
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  always have rent, but your fund that you're investing will feed into an
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  offshore fund.
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  So whenever the rent weakens, that fund...
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  will increase in value and where the rent strengthens against the dollar, that fund
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  value will go lower.
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  effectively, you will get offshore investments, offshore exposure within your
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  local investments
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  without having to have a million rand.
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  You can do it with as little as a 500 rand a month.
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  There's two considerations that have just popped into my head.
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  And the first one is tax.
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  Now, if you send a million offshore, and I don't know how much that is, let's say
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  it's 60, $65,000, something like that, it
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  hits your overseas bank account, is then that subject to tax or is it subject to
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  scrutiny at least,
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  Suzanne?
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  Yes.
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  So as a South African taxpayer, we are taxed on our worldwide income.
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  So any interest, dividends and capital gains tax that you or capital gains that
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  you earn offshore has
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  to be declared in South Africa or wherever you are tax domiciled.
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  Always stay above board with your taxman.
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  That's my motto is do not try and undermine the tax man.
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  because it will come and bite you.
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  So yes, you have to make sure that even your estate planning mentions any
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  offshore investment.
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  So tax is definitely something that you have to consider, even if you've got a
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  direct offshore investment.
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  And the other thing that I wanted to mention was the level of the South African
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  rand on the foreign exchange markets.
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  Now, it had a good 2025.
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  It's had a bit of a wobble for obvious reasons.
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  In 2026, some people are saying that it's all over and the round will be on its way
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  to 19-20 against the
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  US dollar, like it was a few years ago.
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  Not even, actually.
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  But I think the message here is not to try and trade the rand.
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  If you've got the money to diversify your portfolio via some foreign exchange, via
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  that million rand extra allowance, then I think do it.
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  Don't become a currency trader is my message.
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  What's yours?
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  100% my advice to my clients always Once you made the decision to
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  invest in an offshore market or an offshore fund, forget about the rent,
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  forget about the dollar.
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  You are looking for that long-term growth opportunity in the global market because
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  our
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  South African market is so much smaller than the global market.
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  Forget about the currency exchange.
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  Yes, it will go up.
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  Yes, it will go down.
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  The difference in losing...
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  in inverted commas, $1,000 versus 1,000 rands is so much bigger.
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  But the long-term opportunities is much, much better.
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  Forget about the rand.
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  It's practically impossible to predict what the currency is going to do over the
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  next 1, 4, 5, 10, 20
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  years.
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  Great advice as always, Suzanne.
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  Thanks so much for your time.
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  Suzanne Halman is the head of Brenthurst Wealth Tiger Valley, and that was It's My
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  Money.
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  It's My Money was brought to you by Brenthurst Wealth.
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  an award-winning boutique wealth management company.