Offshore investing spreads your savings across currencies and markets, but it brings its own rules, costs and paperwork. This guide is for you if you live in South Africa and want to invest abroad, or send money to your children or other family overseas. It explains the two allowances every adult has, what they cost to use and how the tax works.
The single discretionary allowance (SDA)
Every South African resident aged 18 or older has an SDA of R2 million per calendar year (1 January to 31 December). The Reserve Bank doubled it from R1 million on 8 April 2026, in Exchange Control Circular 6/2026.
You don’t need a tax compliance PIN from SARS to use it. You can use it for any legal purpose abroad. The allowance resets each calendar year, and you can’t carry unused amounts forward.
Children under 18 don’t get an SDA. Instead, each child can have a travel allowance of up to R400,000 a calendar year.
What counts against your SDA
Everything you send or spend abroad under the SDA adds up to the same R2 million. That includes:
- Travel. Foreign currency and the cost of overseas trips count.
- Gifts and loans. Money you send to people living abroad counts.
- Investments. Money you move to a foreign bank account or investment in your name counts.
Keep your own record of what you’ve used, because the limit is yours to keep to.
Gifts can also have tax consequences. In the 2026/27 tax year, the first R150,000 you give away is free of donations tax. Gifts to a spouse who is a South African tax resident are exempt. Above that, donations tax is generally 20%.
The foreign investment allowance (FIA)
If you want to invest more, the FIA lets each adult send up to R10 million more per calendar year. Together with the SDA, that’s up to R12 million a year. Money moved under the FIA can be invested abroad, or held in a foreign currency account at a South African bank.
To use the FIA, you need a tax compliance status PIN from SARS for an Approval International Transfer (AIT). You apply on eFiling, and SARS asks for:
- proof of where the money came from, such as bank statements no older than 14 days, or proof of a sale or inheritance
- a statement of your assets and liabilities for the past three tax years
Once SARS approves, you give the PIN to your bank. The bank uses it to check your tax status on eFiling before it sends the money. PINs can expire, so time your transfer with your approval.
To move more than R10 million in a year, you need Reserve Bank approval. Your bank applies on your behalf, and you’ll still need an AIT PIN.
If you’ve stopped being a South African tax resident, different rules apply. See our emigration money checklist.
Investing offshore without moving money
You don’t have to use your allowances to invest offshore. Many South African unit trusts, and some exchange-traded funds (ETFs) listed on the JSE, invest abroad for you. You pay in rand and get paid out in rand, but the fund follows offshore markets. These are sometimes called rand-denominated offshore funds, or asset swap funds.
Fund managers invest abroad under their own limits, set by the Reserve Bank, so your SDA and FIA aren’t touched. Retirement funds, including RAs, can also hold up to 45% of their assets offshore. That limit comes from Regulation 28 of the Pension Funds Act.
Each route has trade-offs. Investing directly puts money in your name abroad, which helps if you’ll spend it there. But it means more paperwork, and your family may have to deal with that country’s estate rules when you die. Rand-based funds are simpler, but the money stays in South Africa.
Practical steps
- Check what you’ve used. Add up this calendar year’s travel, gifts and transfers.
- Choose your route. Decide between investing directly offshore or buying a rand-based fund here.
- Get your AIT PIN first if you’ll send more than your SDA. Allow time for SARS to review your documents.
- Compare quotes. Ask your bank and at least one registered forex provider for their rate and all their fees.
- Send the money to an account in your own name. Your bank will check your ID and record the purpose of the transfer.
- Keep records of every transfer, and of the documents behind it.
What it costs
Often the biggest cost is the exchange rate. The rate you’re offered is usually worse than the mid-market rate, which is the midpoint between buying and selling prices. The difference is called the spread, and it’s how many providers earn their money.
You may also pay a transfer fee, fees charged by banks in between, and fees on the account or platform abroad. Once your money is offshore, currency moves can work for or against you.
Assumptions: you’re a South African resident aged 18 or older. Earlier this calendar year, you spent R150,000 on an overseas holiday, which counts towards your SDA. You now want to invest R5 million abroad.
| Amount | |
|---|---|
| SDA for 2026 | R2,000,000 |
| Less holiday spending | R150,000 |
| SDA left, no tax PIN needed | R1,850,000 |
| Balance to send under the FIA, with an AIT PIN | R3,150,000 |
| FIA still available this year | R6,850,000 |
What the spread could cost: on R5 million, a 0.5% spread would cost R25,000. A 1.5% spread would cost R75,000. Other fees come on top. These spreads are only examples, so ask for actual quotes.
Tax on offshore income
The allowances are about exchange control, not tax. While you’re a South African tax resident, you’re taxed on your worldwide income. So you must declare interest, dividends, rent and capital gains from offshore investments in your South African tax return.
If you’ve paid tax abroad on that income, you can usually claim it as a credit against your South African tax. That stops you being taxed twice on the same income. Keep the statements from every offshore account, so you can show SARS the income and any tax you paid abroad.
This guide is general information to help you understand your options. It isn’t advice for your situation. Figures are for the 2026/27 tax year (1 March 2026 to 28 February 2027) and were checked on 28 September 2026.