26 Mar SwissFin – SwissSure Newsletter March 2019
We welcome you to our first Newsletter for 2019.
We have some exciting news to share with you: Our Forex offering has taken off and we are very pleased to see that many of our clients are making use of our services. Our rates are very favourable and you will find more information in one of the articles below.
Another exciting development is the increased hole-in-one cover on our GolfEstateSure policy: With R 20’000 we offer by far the highest coverage for this special event! There have been more amendments, which are summarized under the short-term insurance chapter.
Another focus in this edition is the maiden Budget Speech by our Finance Minister, Tito Mboweni, which was held on 20 February 2019.
We have also included information for you across the board regarding insurance, immigration, taxation and other related topics.
Enjoy the reading, with best regards,
Your SwissFin / SwissSure – Team
- Interest rates: Bank deposits, insurance plans, tax-free investment amounts and our foreign exchange rates
- How does our Forex offering work?
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
4. SWISSSURE: SHORT-TERM INSURANCE NEWS
- Exciting amendments to our GolfEstateSure policy
- Santam: New geyser limits
- Old Mutual Insure: New procedure for bicycle repairs
- Sir Geoffrey Boycott joins our GolfEstateSure family
- Important details for the MUA concierge booking
- Please be aware of the credit shortfall if your car is written off!
- Vantage changes insurance carrier
- Load shedding and potential dangers
- MUA announces product enhancements
- Department of Home Affairs loses court case
- Home Affairs shares data with the police
- How does a spousal or partner visa work?
- Please apply for your ID and driver’s licence
- Home Affairs – cell phone ban!
6. HEALTH INSURANCE
- SwissSure at Arabella’s Captain’s Day
- What are your rights at a Roadblock?
- Have you got a will for your South African assets?
- We value your comment
Interest rates: Bank deposits, insurance plans, tax-free investment amounts and our foreign exchange rates >>
SwissSure offers the following rates as of March 2019:
Interest rates ››
- Our Money Market Fund
- 12 Months bank deposits
Insurance Plans: “Guaranteed income/growth plans” (5 year term), approx. 80% of the income is tax-exempt: ››
- Gross yield
- Taxes payable
Tax-free interest income – maximum investment amounts: ››
R 1 456 000 for taxpayers under the age of 65
R 2 221 000 for taxpayers between the age of 65 and 75
R 2 525 000 for taxpayers over the age of 75
These figures mean that you can invest these amounts in i.e. our money market or fixed deposit offerings and not pay any tax. Couples married in community of property can double these amounts!
Underlying assumptions: 7,0 % effective interest rate and no other income sources.
SwissSure Forex Rates ››
- Bank A
- Bank F
- Bank N
- Bank S
- Our Rate
The above table shows that our rates are attractive compared to commercial banks. Over and above, we do not charge any fees when the funds are credited or transferred to another local account.
How does our Forex offering work? ››
In order to make it a seamless process for our clients, please follow the below steps:
Before we can accept any funds, we will need to open up an account for you. We need:
- A copy of your passport or ID
- A utility bill (proof of residence)
- The details of your local current account
- Short account opening forms
- There were no changes to personal income tax and brackets. Due to annual salary increases, taxpayers will move into higher brackets and pay more tax. The expected additional revenue for the Government is estimated at R 12.8 Bio.
- In addition, there were no changes to medical tax credits. This measure will have a similar effect as above and result in a further R 1 Bio. additional income for the Government.
- The increases in the general fuel levy and the Road Accident Fund at 15c and 5c per litre are modest compared to last year’s 52c.
- A new carbon tax on fuel will come into effect from 5 June 2019. The rate is 9c per litre on petrol and 10c per litre on diesel.
- By far the biggest concern is our state-owned entities (SOEs). Eskom will require support amounting to R 23 Bio. per year over the medium term. The company will also be restructured and split into 3 different entities.
- Massive cuts in government spending will result in a saving of R 4.8 Bio. This will be achieved by remuneration cuts and early retirement for older public servants.
- The positive news is that measures to stimulate economic growth and job creation in a number of areas were announced.
- The revenue collection deficit is predicted to shrink by around R 42.7 Bio. from last year, but still remains at an uncomfortable figure of R 1,3 Trillion.
- As usual, the annual boring “sin taxes” have been adjusted with the following results:
A 340ml beer will cost 12 cents more, a packet of 20 cigarettes R 1.14, a bottle of wine 37 cents and spirits R 4.54
There have been no changes to Donations Tax, Estate Duty, Capital Gains tax or any other taxes.
For most of our clients we do have these documents on file and we will advise you which documents we still require.
You give instructions to your overseas bank as follows:
When transferring your foreign currencies, please use the details provided below. It is important that your name and your Investec account number is 100% correct!
Should these details not match, your funds will unfortunately be returned.
The minimum conversion amount for any currency must be the equivalent of R 100’000 or more.
Beneficiary: Your name and surname
Bank account: Your account number with Investec (starts with 500…)
Bank: Investec Bank,
100 Grayston Drive, Sandton, Johannesburg, South Africa
Swift code: IVESZAJJXXX
Once you have transferred the funds, we will automatically be notified by Investec once the funds are in SA. These transfers normally take 2 – 3 business days to clear.
Our office will call you and inform you of the live exchange rate. The rate is a net wholesale rate and there are no additional charges.
You do not have to accept the rate but will be required to convert the funds within 30 days (Reserve Bank ruling). If not, the funds will be sent back to your bank and a transfer fee applies.
Once converted, the funds will be immediately transferred to your local current account. Alternatively, they can remain at Investec at money market rates and transferred at a later point in time. Again, there are no transfer costs from our side and your receiving local bank will not charge any fees if Rands are deposited.
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
Not all banks will allow BVI companies to retain bank accounts ››
The British Virgin Islands are a well regulated jurisdiction for the opening and management of offshore companies. However, the same cannot be said about its banking sector. BVI is not a financial centre and does not, in fact, have many banks locally that actually cater to the international business sector. Therefore most companies will have to open an off-shore account in another country.
In a recent circular by one of the offshore banks, the term and usage of “shell companies” has been further defined. As a result, many BVI companies that have no “substance” may no longer be able to operate bank accounts overseas and such will be closed.
“Substance” means the following: The company is defined as having such, if it has established economic activity in the BVI jurisdiction. This requires a physical presence like an office, factory, warehouse etc. It is a further requirement that the company employs staff and that funds are spent on rent, salaries etc. in the jurisdiction.
Failing these requirements, many offshore banks have now discontinued the use of bank accounts for BVI shell companies.
So before you consider a BVI structure, check whether you can operate a bank account for the company in another country.
Budget Speech highlights ››
Overall, it was a promising budget, which shows resolve in tackling some of our deep-seated issues. There are no quick fixes, but then it has to begin with good intent and a sensible plan, both of which seem to be in place.
The highlights were:
The income tax tables for individuals for the tax year 2020 (1 March 2019 to 28 February 2020) are as follows:
Taxable income (R)
Rates of tax (R)
0 – 195 850
18% of taxable income
195 851 – 305 850
35 253 + 26% of taxable income above 195 850
305 851 – 423 300
63 853 + 31% of taxable income above 305 850
423 301 – 555 600
100 263 + 36% of taxable income above 423 300
555 601 – 708 310
147 891 + 39% of taxable income above 555 600
708 311 – 1 500 000
207 448 + 41% of taxable income above 708 310
1 500 001 and above
532 041 + 45% of taxable income above 1 500 000
Secondary (65 and older)
Tertiary (75 and older)
65 and older
75 and older
Given the economic realities facing the Minister of Finance this year, it is unsurprising that he had a difficult task in balancing the need to improve tax revenue with the implications of placing additional tax burdens on the individual taxpayer.
The budget reemphasised that that there is no quick fix to address the serious economic problems facing South Africa. This is especially true as the economy is likely to be affected by the slowing of the world’s major economies. Tax revenue from some key projects of the the government had to be revised down.
Reduced tax collections, dismal growth and even more financial commitments like the budget deficit, SOE bailouts, NHI and higher education costs are putting huge pressure on the Minister.
Many South Africans will be asking whether the Budget really addresses the fundamental problems to put the country towards sustainable. Many will, unfortunately, conclude that it does not.
3. SWISSSURE: SHORT-TERM INSURANCE NEWS
Exciting amendments to our GolfEstateSure policy ››
We are very pleased to inform you about the following changes on our policy for residents on golf estates:
– Highest hole-in-one cover in South Africa, R 20’000, payable once per calendar year.
– Your golf equipment is insured free of charge and worldwide, should it get lost, stolen or damaged. The limit has been increased from R 20’000 to R 30’000, but an excess of R 1000 applies per claim, for clients younger than 55.
– The short-term insurance Act has changed and we had to remove the extension for medical costs in case someone gets injured by a golf ball. The Act prescribes that a short-term insurer may not be seen to do the business of a medical aid.
Please contact our short-term insurance department if you require any further information.
Santam: New geyser limits ››
The insurer has introduced a streamlined process for repairs and replacements of geysers for body corporates.
Please click here to read the circular.
Old Mutual Insure: New procedure for bicycle repairs ››
Old Mutual Insure has partnered with Cycle Lab and Carbon Bike Repair to manage all bicycle claims. Should you have to register a claim, you can contact our claims department or contact OMI directly, by following the details in this attachment. Please click here to download it.
Sir Geoffrey Boycott joins our GolfEstateSure family ››
We are very proud to announce that Sir Boycott has concluded a GolfEstateSure policy.
For those not familiar with his name, Sir Geoffrey Boycott is a famous cricketer and was the captain of the English national cricket team.
He established himself as one of England’s most successful opening batsmen and since retiring as a player, he has found further success as a cricket commentator. He has got a holiday home on Pearl Valley Golf Estate and regularly visits South Africa.
The picture below shows Tony R. Hug handing over the GolfEstateSure policy documents to Sir Boycott.
Important details for the MUA concierge booking››
There have been some amendments to the service offering to make it easier for clients to use it.
Clients are welcome to send their booking details via e-mail to the below recipients:
Please note that transports to and from the airport need to be booked at least 48 hours in advance. Attached please find a pamphlet with more details, which you can download here.
The development team is currently working on an app for the service.
Our comment: For a monthly fee of R 60 we can only recommend to subscribe to this service! MUA will take you home if you had one drink too many, take you to the airport etc. We believe that no other service offering even comes close to this excellent value package.
Please be aware of the credit shortfall if your car is written off! ››
One of our clients recently experienced a write-off with her vehicle and we were glad to see that she was unhurt in the accident.
Her car was financed through her bank and although the insurance paid out the sum insured of the vehicle, she had to settle the shortfall with the bank. Her finance package was structured that she ended up having to pay in almost R 100’000 in finance charges etc.!
Please make sure that you take out credit shortfall cover with your bank, or alternatively consider the IVP policy from Renasa:
The product called “Inception Value Policy” (IVP) allows you to lock the current retail value on your vehicle; therefore the value does not depreciate over the duration of the policy.
The benefit is a top-up-cover to an existing comprehensive motor insurance policy. It is a standalone product based on the current TransUnion retail value and can be linked to any insurance company.
The “Inception Value Policy (IVP)” carries the following features:
– It pays out the difference between retail value at inception of the IVP policy and retail value at date of loss (Insurance policy)
– A possible credit shortfall for financed vehicles is automatically included
– Depreciation is therefore insured, for all vehicles – financed and non-financed ones
– Any age of vehicle qualifies for the IVP policy, which means the cover is not only available to new cars, but also to second-hand ones.
The premium rates are based on the value of the vehicle which starts from R 85 p.m. Considering the low premium, we recommend all our clients to take out this cover.
For more information, please contact .
Vantage changes insurance carrier ››
With effect from 01 April 2019, Vantage Insurance Acceptances (Pty) Ltd (“Vantage”) will act as an approved Underwriting Manager (“UMA”) on behalf of Santam. Vantage will enjoy direct support from Santam, the largest short-term insurer in South Africa.
All of Vantage’s policies will change to Santam on the following basis:
Monthly Vantage policies will be incepted by Santam on 01 April 2019 and Centriq then ceases to be your insurer.
Annual Vantage policies will be renewed and incepted by Santam at the policy’s renewal date. Centriq will remain your insurer until such renewal date.
Vantage will continue to underwrite, administer and manage policies on behalf of Centriq, whilst Centriq is still the noted insurer. Please note that there will be no change in cover provided under your existing policy, or changes to your premiums and fees as a consequence of the change in insurer.
Load shedding and potential dangers ››
Unfortunately Eskom has dropped the country back into the dark. With the outage of electricity supply come dangers which you please need to be aware of:
– Make sure that electrical appliances are “off” during the load shedding period. We have seen claims, where a pot kept cooking unattended and caused a fire in the house. Another incident was a hair-dryer on a bed that was left “on” and also caused a fire when the power was supplied again.
– Unplug all appliances: This is not only because of the fire risk mentioned above, but when power is restored, the spike in electricity (“power surge”) can easily damage cell phones, TVs, computers and other electronic equipment.
– Test your alarm system: During load shedding, your alarm will run off the batteries. Test if they are still functional to avoid an increased burglary risk. Have your alarm system serviced bi-annually.
– Install reserve batteries for gates and fences: The load shedding decreases the life span of batteries and you should regularly have them tested and replaced.
– Be aware of generators: They should never be used inside a room and make sure that the carbon dioxide does not pose a risk to anybody.
In general, always be vigilant during load shedding periods. Criminals are more likely to use these blackout periods to commit a crime.
And lastly, check that your insurance policy covers “power surge”. If you are not certain, please contact your consultant at our short-term insurance department.
MUA announces product enhancements ››
The insurer has introduced exciting policy conditions and limits, which are all in favour of the policyholder.
Please click here to read the comparison between the old and new executive policy.
Department of Home Affairs loses court case ››
Incorrect adjudications of applications have unfortunately become the norm.
We were very relieved to see that the Department lost a court case with regards to the definition of “retirement income”.
The applicants applied for a permanent residence permit under the retired category (section 27e of the Act). In addition to the pension income, the applicants showed sufficient rental income which in total was almost double than the prescribed R 37’000 per month.
The Director General rejected the application arguing that the applicant failed to prove sufficient financial means.
The matter went to the High Court and the Department was ordered to issue the requested Permanent Residence Permits.
In another case, our office appealed a decision by the Department. The application was again under the retired category for permanent residence. The pension income was just below the required minimum, but an investment portfolio with large interest and dividend income exceeded the minimum by far.
Our appeal was successful and the outcome will make it difficult for the Department to decline future applications with income other than just pensions.
Home Affairs shares data with the police ››
It has been confirmed that the Department’s information and communication technology system is synchronised with the South African Police Service’s (SAPS) systems for biometric identification.
SAPS have access to the National Identification System (HANIS) system via the interface between Integrated Justice System (IJS) and the Department of Home Affairs (DHA).
The following biometrics are stored: Name, facial image, contact information, date of birth, country of birth, living indicator, death date, gender, marital status, residential address and postal address.
How does a spousal or partner visa work? ››
In order to approach an application correctly, the following starting criteria is important:
– If you are married or are a life partner to a SA citizen or permanent residence holder, and
– How long you have been married or involved in the life partnership.
You can apply for a temporary spousal visa which is normally issued up to 3 years. This can be done as soon as you are married.
You must have been married for at least 5 years to apply for a permanent residence permit. If you want to reside in South Africa, you probably have to apply for the visa and the permit, as the processing time for permanent residence permits is up to 3 years.
Life partners of South African citizens or permanent residents can apply for a life partner visa, provided the relationship is valid and that cohabitation has existed for at least 2 years.
Temporary visas are issued for up to 3 years.
It is important that sufficient evidence is submitted to proof the relationship, which must be of a permanent nature. Proving cohabitation is the main criteria that the Department wants to see.
Life partners can apply for permanent residence if it can be proven that the relationship has existed for at least 5 years.
Again, in most cases the applicant should apply for the visa and the permanent residence to bridge the unacceptable lengthy time in processing PR applications.
Same sex couples:
Spousal permits are available for same sex couples who are married and the process is identical to the one above under “marriage”.
Questions often arise if persons on spousal or life partner visas are allowed to work. It is of great advantage to have a spousal / life partner visa, as these will open doors to work, study or have your own business. A simple endorsement to the spousal visa can be made once sufficient documentary proof is submitted.
Once you have a permanent residence under the spousal category, no endorsement is needed and you are free to work, study or run your own business.
The same rules apply to same-sex relationships.
Please apply for your ID and driver’s licence! ››
The ID Book, which also comes in a credit card format, is used for day-to-day purposes in South Africa. Only holders of a permanent residence (PR) permit can apply for an ID.
We strongly recommend that you apply for an ID immediately after your PR has been issued at your nearest office of the Department of Home Affairs. It is law that you have to apply for an ID within 5 years from when the PR is issued.
The following documentation is needed:
– Form BI-0
– 2 passport photographs
– Certified birth certificate
– Certified marriage certificate
– Certified PR document (the department issues another copy for you)
You do not have to leave the original PR with the Department. The certified copy is used to verify that your PR is not fraudulent. This procedure will take a few weeks until the formal application can be submitted.
It takes up to 3 months to issue an ID book and the first one is free of charge. Please check on your receipt that all your personal details are correctly recorded.
Once you have received your ID book, please apply for a driver’s licence at the Traffic Department. The law prescribes that you need to apply for a driver’s licence within 12 months of issue date of the PR. If you miss this deadline, you cannot convert your foreign driver’s licence and you have to do the driver’s test again.
Please note that you can keep your foreign licence and you do not have to hand it in.
If you do not apply for an ID book and driver’s licence, there could be several problems facing you:
– On departure and entry into SA, some immigration officials may want to see your ID book. Failing this, they can hold you back for questioning which can result in you missing your flight.
– Another possible problem is your insurance policy and if you are involved in a motor accident.
– In terms of the FACTA/CRS banking guidelines, you have to inform your bank if you are resident or not.
Unfortunately the possible problems are not always easy to solve and we appeal to you to apply for your ID.
Home Affairs – cell phone ban! ››
The parliamentary committee on home affairs has welcomed the report that the use of cell phones by front-desk members at the offices of the Department during working hours is banned.
The committee received complaints by citizens, after a video on social media showed staff on their cell phones whilst people had to wait in long queues.
The Department has issued written warnings to such staff members. It is also encouraging the public to monitor the situation and to report bad service and to identify staff that is undermining the Department’s service mandate.
6. HEALTH INSURANCE
Important information to clients on the Globality Essential Plan ››
Please note that the Essential plan does not cover any treatment that is performed out of hospital or in a day clinic. Only the Classic, Plus and Top plans offer such benefits.
The only time the Essential plan provides payment for such costs, is if a stationary treatment in a hospital can be done in a day clinic.
We recently dealt with a case, where a patient had to undergo a cataract operation. These types of operations are never performed in-hospital and treatment takes place in a day clinic. The Essential plan would therefore never cover the operation.
Because of the increasing multitude of operations performed in day clinics, we recommend to all our clients to please upgrade from the Essential to at least the Classic Plan.
GAP cover is essential! ››
The cost gap between the reimbursement of local medical schemes and the invoices from doctors and specialist seem to widen year on year.
We have mentioned it several times in previous newsletters: If you are on a local health insurance platform, you need to take out gap cover. Although there is an overall limit in terms of the short-term insurance Act, it is worthwhile and essential to have gap cover.
SwissSure at Arabella’s Captain’s Day ››
On the 23rd February 2019, we hosted the Captain’s Day at Arabella Golf Estate, near Kleinmond. This year was the 15th year in succession, since we started supporting this golf day.
As usual, we provided the lucky draw for the chauffeur driven Bentley Drive, for two people to a wine estate for lunch. The lucky winner was Mr David Sowden – congratulations!
What are your rights at a Roadblock? ››
It is always an uneasy feeling being pulled over by the police or being stopped at a roadblock.
Herewith some recommendations on how to deal best with the situation:
– Pull over when you are asked to stop. Do not drive away, be polite, give your personal details when requested and stay calm.
– If you are presented with a fine or infringement notice, sign it there and do not argue – you will not win the argument on the roadside!
– Don’t offer a bribe or accept one. This can land you in serious trouble.
– Not only can a police officer ask for your ID, driver’s license and car license, but also that you present your car at a police station within a week.
– You are allowed to ask to see the officer’s identification. If he refuses, stay calm and take note of their vehicle details. If an officer fails to produce his identification, he is in breach of Section 334 of the Criminal Procedure Act.
– You are allowed to see written authorization for the roadblock from the National or Provincial Police Commissioner. If you are not certain about the validity of the roadblock, you can request to be taken to the nearest police station.
– If your car is to be found not roadworthy, the police officer can instruct the following:
Request that you drive your car to your destination or a shorter distance;
Or remove your license disc;
Or that you cease to drive the vehicle immediately.
In all these cases, you have to follow the officer’s instructions.
– If you have outstanding fines, you cannot be arrested unless the officer can show a valid copy of the arrest warrant. If the officer still wants to arrest you, call your lawyer immediately.
If the officer does have a warrant, he can detain you until you pay the outstanding fines. If no warrant has been issued, the police can issue you with a summons and a court date with a minimum of two weeks in advance (excluding weekends and holidays).
– Under the influence of alcohol: If the officer asks you if you have been drinking, do not lie, as a positive breathalyzer test will work against you in court. If your blood-alcohol level is above the legal limit (0,05g/dl), you will be taken to a mobile unit, clinic or similar where blood will be drawn. You have the right to insist on clean and sterile equipment. You can also call your own doctor, provided he/she can get there within the 2-hour limit. This is the time limit for the test to be acceptable and a police officer must be present. You may be detained whilst your case is in process, but only with the same gender as yours.
– If you are arrested: You must be told your rights, taken to the nearest police station, you have the right to appear in court within 2 days. You can apply for bail at the station, unless you are detained for a serious offence.
We hope that these points will assist you, but hope you will never have to apply them.
Have you got a will for your South African assets? ››
We regularly see that foreigners with property in South Africa do not have a South African will. If a spouse passes on without a valid South African will, it poses all sorts of problems that could have easily been averted.
Should you require any further information on this topic, please do not hesitate to contact Tony R. Hug on