Remittance of income to non-residents: easier or harder?

Background

Up until 22 October 2025, bona fide non-residents living outside the Common Monetary Area (CMA) and private individuals who had ceased to be tax resident could remit income offshore provided the Authorised Dealer was satisfied that tax emigration had been placed on record and the source of funds verified.

A tax clearance from SARS was only required for income distributions from a South African trust:

• Under R10 million: TCS pin for good standing.
• Over R10 million: Approval for International Transfer (AIT) TCS pin.

What has changed?

Under the new rules:

SARS is now more involved in verifying compliance before funds can be externalised.

Whether you are transferring dividends, rental or income of any amount from both an inter vivos or testamentary trust, if the recipient of the income still has an active tax number they will be required to submit an Approval of International Transfer (“AIT”) TCS pin from SARS.  Which is the same process currently available for the remittance of capital in the instance of a person who ceased to be tax resident.

In the case of a trust, whether income is paid from an inter vivos or testamentary trust, if the recipient still has an active tax number, an AIT TCS pin is now required for any amount.

No tax number? SARS allows applicants to request a Manual Letter of Compliance for International Transfers (“MLC”) which will involve the same submission to SARS, without having to register as a taxpayer first.

Important caveat: If a person ceased tax residency years ago or formalized their financial emigration via SARB but never updated their status with SARS post-1 March 2021, they must register with SARS to update their tax residency before remitting income. The MLC process does not address this requirement.

Exceptions

• Interest income: No TCS pin required.
• Pension and annuity payments: Require a TCS pin for good standing annually, plus evidence of a prior year’s tax certificate.

Timing and administration

• Good standing certificate: approval within minutes if compliant; valid for 12 months.
• AIT TCS pin or MLC - Can take up to 21 working days or longer depending on the amount to be transferred, requires supporting documentation and must be applied for each remittance.

Insights

While the changes aim to strengthen compliance, they introduce additional administrative steps, particularly for trust distributions and individuals without updated tax residency records. This could create delays and complexity for applicants who previously relied on simpler processes.

The takeaway

Applicants should:

• Confirm their SARS tax residency status before initiating transfers.
• Prepare supporting documentation early to avoid delays.
• Seek professional assistance to navigate the new requirements and ensure compliance.

Author:
Sharon MacHutchon, Manager