08 Mar SwissFin – SwissSure Newsletter March 2023
We welcome you to our first Newsletter for 2023.
The budget speech by our finance minister and some insights in the economic challenges of our country, like the grey-listing by the Financial Action Task Force, fill the headlines of this newsletter. As usual, we have included information for you across the board regarding insurance, immigration, taxation and other related topics.
This newsletter can be viewed under https://www.swissfin.co.za/newsletters/swissfin-swisssure-newsletter-march-2023/.
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
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
4. SWISSSURE: SHORT-TERM INSURANCE NEWS
- Keep an eye on your car hire period!
- Discovery Insure: New power surge limits
- Clarification on power surge damages and grid failure exclusion
- Santam amends excess structure
- Bryte adds more vehicles to tracking requirement list
- Update on our court case
- Your PR is issued – what are the next steps?
- Life partners have to be present at application submission
- Problems with loading VFS applications
- New edition of our immigration book is available
6. HEALTH INSURANCE
- SwissSure sponsors Winelands Classic Golf Day at De Zalze
- How to obtain your traffic register number as a foreigner
- We value your comment
Interest rates: Bank deposits, insurance plans, tax-free investment amounts and our foreign exchange rates >>
Interest rates ››
SwissSure offers the following rates as of March 2023:
- Our Money Market Fund
- 12 Months bank deposits
- 24 Months bank deposits
- 36 Months bank deposits
- 48 Months bank deposits
- 60 Months bank deposits
Minimum investment is R 100’000. Terms and conditions apply and the rate is dependent on the investment amount.
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 1,78 Mio. for taxpayers under the age of 65
R 2,51 Mio. for taxpayers between the age of 65 and 75
R 2,75 Mio. 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.
2. LOCAL AND INTERNATIONAL FINANCIAL NEWS
One more interest rate hike ››
As was predicted by economists, academics and analysts, the SARB has announced a 0.25% interest rate increase on the 25th January 2023. This comes amid high inflationary conditions in South Africa and interest rate hikes are key to containing inflation.
The prime lending rate is now 10.75%.
It seems that interest rates are close to a peak and the Reserve Bank is confident that inflation will get back into the target range in the mid-term.
On a R 1,0 Mio. home loan over a 20-year term, the new instalment amounts R 10152 p.m., an increase of R 170 p.m.
It’s official now, South Africa has been grey-listed ››
SA has been placed on the Financial Action Task Force’s ‘greylist’, which means it has shortcomings in tackling illicit financial flow, which may raise costs for banks and asset managers.
The greylisting, aimed at curtailing money laundering and terrorist financing, places South Africa in the same category as Haiti, Syria, Nigeria and Yemen. Despite an energetic attempt by SA to avoid being greylisted, the task force wanted more evidence that SA was in a position to police two sets of new laws it has implemented to bring the country into line with international best practice.
In what constitutes a kind of backhanded compliment, the Financial Action Task Force (FATF) said when it places a jurisdiction under increased monitoring, “it means the country has committed to resolve swiftly the identified strategic deficiencies within agreed time frames. New jurisdictions subject to increased monitoring are SA and Nigeria.”
The move constitutes a blow to SA’s international financial standing around the world, and the Reserve Bank has warned that greylisting could have wide-reaching consequences for SA’s financial system.
Budget Speech highlights – experts give thumbs up ››
Our finance minister Enoch Godongwana presented his budget on 22 February 2023. This is a summary of the most important points:
- Real GDP will fall back below SA’s population growth rate for the next two years – to 0.9% in 2023 and 1.5% in 2024. This is due to power cuts, deteriorating rail and ports infrastructure and weaker global economy.
- Inflation is expected to fall from 2022’s 6.9% to 5.3% this year and 4.9% in 2024.
- The South African Revenue Service (SARS) is expected to collect R 1.69 trillion in gross tax revenue for the current tax year, which exceeds the budget estimate by R 93.7 billion.
- Government will take ‘urgent measures’ to reduce power cuts including opening electricity supply to the private sector. From 1 March 2023, individuals who install rooftop solar panels will be able to claim a 25% rebate of the costs of panels, up to a maximum of R 15’000. This can be used to reduce their tax liability in the 2023/24 tax year and only available for one year. The rebate will not be available to inverters or batteries.
The expansion to solar tax incentive is also widened to companies, Between 1 March 2023 and 28 February 2025, businesses will be able to claim a deduction of 125% in the year in which a renewable energy project is brought into use. These projects have no thresholds on generation capacity.
- Annual debt service costs are now over R 340 billion – triple what is spent on Police and the Budget’s biggest line item, ahead of Basic Education (R 310 billion) and Social Grants (R 286 billion).
- The Budget Deficit will decline from 4.6% to 4.2% of GDP for this year; with Treasury targeting 3.2% in 2025/26. This is a significant improvement helped by higher tax income due to better commodity prices and compares with projections of 5.1% for 2022, 4.9% for 2023 and 3.3% for 2024.
- Debt relief to Eskom of R 254 billion is granted over the next 3 years. Conditions are attached because of non-paying municipalities, which currently owe over R 56 billion.
The Government further guarantees R 350 billion of Eskom’s R 423 billion debt. Some of Eskom’s coal power stations might be concessioned to private operators.
- The 2023 Budget allocates additional funding of R 227 billion over the next three years, mainly to extend the COVID-19 social relief of distress grant until 31 March 2024.
Old age grant will be increased to R 2080 p.m., a child grant 510 p.m. and the foster care grant to R 1180 p.m. by October 2023
- The corporate income tax rate for the year of assessment ending on or after 31 March 2023 will reduce to 27%.
- Medical Scheme Fees Tax Credits: The value of the medical tax credit is proposed to increase by inflation from R 347 to R 364 p.m. for the first two beneficiaries. The monthly credit for the remaining beneficiaries is new R 246 p.m.
- There are no changes to the general fuel levy or the Road Accident Fund levy.
- The deduction for home office expenses is only valid, if you spend more than 50% working from home. Someone that travels 3 days a week to the office will therefore no longer qualify for a deduction.
- There are no changes to donations tax, estate duty and capital gains tax.
- Excise duties:
A 340ml can of beer increases by 10 cents.
A 750ml bottle of wine goes up by 18 cents.
A 750ml bottle of spirits will increase by R 3.90
The duty rises with 98 cents on a pack of 20 cigarettes.
The income tax tables for individuals for the tax year 2024 (1 March 2023 to 28 February
2024) are as follows:
|Taxable income (R)||Rates of tax (R)|
|0 – 237 000||18% of taxable income|
|237 001 – 370 500||42 678 + 26% of taxable income above 237 000|
|370 501 – 512 800||77 362 + 31% of taxable income above 370 500|
|512 801 – 673 000||121 475 + 36% of taxable income above 512 800|
|673 001 – 857 900||179 147 + 39% of taxable income above 673 000|
|857 901 – 1 817 000||251 258 + 41% of taxable income above 817 600|
|1 817 001 and above||644 489 + 45% of taxable income above 1 817 000|
|Primary||R 17 235|
|Secondary (65 and older)||R 9 444|
|Tertiary (75 and older)||R 3 145|
|Under 65||R 95 750|
|65 and older||R 148 217|
|75 and older||R 165 689|
The transfer duty table has been adjusted by 10% as follows:
|Property value (R)||Rates of tax (R)|
|0 – 1 100 000||0% of property value|
|1 100 001 – 1 512 500||3% of property value above 1 100 000|
|1 512 501 – 2 117 500||12 375 + 6% of property value above 1 512 500|
|2 117 501 – 2 722 500||48 675 + 8% of property value above 2 117 500|
|2 772 501 – 12 100 000||97 075 + 11% of property value above 2 722 500|
|12 100 001 and above||1 128 600 + 13 of taxable income above 12 100 000|
4. SWISSSURE: SHORT-TERM INSURANCE NEWS
Keep an eye on your car hire period! ››
Worldwide, the supply chains are still feeling the after-effects of Covid.
It has come to our attention that parts for Haval and Chery Tiggo’s are having major delays and clients have to wait much longer than normal. Currently, the waiting period on an airbag sensor for a Haval is 6 months!
We suggest you check your car hire period on your policy and extend it if necessary.
Discovery Insure: New power surge limits ››
The insurer has amended the coverage due to the multitude of claims received. Please click here to download the overview.
Please click here to read the communique to all Western clients. The insurer had to amend their cover to make sure that their policies are compliant with legislation.
Clarification on power surge damage and grid failure exclusion ››
Most insurers have changed their domestic and commercial policy wordings as follows:
Electricity Grid Failure Exclusion:
Notwithstanding any provision of this policy including any exclusion, exception or extension or other provision not included herein which would otherwise override a general exclusion, this policy does not cover any loss, damage (whether physical or financial), liability, claim, cost or expense directly or indirectly caused by, contributed to by, resulting from, arising out of or in connection with any electricity grid failure.
Electricity grid failure means a total or partial interruption, suspension or blackout of the electricity supply from the national, regional or private electricity grid to the electricity grid of South Africa for whatsoever reason, whether due to damage, an inability and/or failure, whether partial or total, of the utility supplier to generate, transmit or distribute electricity, or any other cause.
The above does not mean, that power surge damages are no longer covered!
The exclusion refers to consequential losses arising from a total blackout of the entire electricity supply countrywide. Items that are affected, like fridge or deep freeze contents that are spoilt, and any other consequential losses are excluded.
Please take note that the following companies have implemented the exclusion:
– Santam (please click here to read the exclusion)
– Western (please click here for the general exclusion and here for the BI exclusion)
– Vantage (please click here to read the new policy wording)
– Hollard (please click here to read the notice)
– Bryte (click here to see the new policy wording)
– MUA (click here to see the circular)
TRA, IUM and Old Mutual Insure
Please take note of the above if you are a policyholder of one of these companies!
Santam amends excess structure ››
South Africa’s largest insurer has made inflationary amendments to their excess structure. Please click here to view the new amounts.
Bryte adds more vehicles to tracking requirement list ››
Vehicles that are preferred on the list of car thieves, like the Toyota Fortuner, Toyota Hilux, VW Polo etc., will now require tracking devices in order to be covered against theft.
Please read the communique from Bryte by clicking here.
Update on our court case››
As per the attached court order – click here to view, the Department was ordered to issue all long outstanding PR applications.
The process was extremely slow and the Department is still far behind the work.
From 180 applications, 83 have been approved, 70 are still being processed and 27 were rejected. We have appealed against the rejections because they were unlawful but the Department has not yet responded.
On a rather disappointing note, the attorneys Pasno Nyachowe and the advocate Simba Chitando, who were nominated by the class action leader Global Migration, have ceased to represent us. Their argument is that the agreement was to obtain the court order. Any additional steps would form part of a new mandate and would be part of another set of fees. We are currently assessing the situation and will keep you informed.
Your PR is issued – what are the next steps? ››
Validity period of a permanent residence permit
After the permanent residence permit has been issued you have 12 months from the issue date to take up residence in the Republic. You can extend such period upon application should valid reasons restrict you from travelling (e.g. sickness). The permit is valid for life. Please note that there is no requirement that you have to spend a certain amount of time in South Africa with a PR certificate. If you are already in South Africa when the PR is issued, your entry stamp makes the PR certificate valid.
Expiry and withdrawal of a permanent residence permit
You can lose your permit under the following circumstances:
- Residence has not been taken up within the first 12 months and no application for extension has been submitted (Section 28(d)).
- Submission of false documents or giving wrong information will immediately render the permit nil and void.
- You have been convicted of a serious criminal offence (Murder, rape etc., section 29 & 30).
- You have been absent for more than 3 years from the Republic unless the reason was related to work, family etc. (Section 28(c)).
- Entering a fake spousal relationship for the primary purpose of gaining benefits under the Act or a divorce within 3 years after being granted permanent residence.
- The minimum capitalisation or employment requirements for applicants with business permits cannot be maintained.
Should a permanent residence permit be withdrawn, you must hand in your identity document at the nearest Department.
Travelling with your permanent residence certificate
You no longer receive a PR sticker in your passport, and you have to travel with your certificate. Please have the following with you when crossing the border:
- Your passport;
- The PR certificate; we recommend that you make a colour copy, have it certified and laminated and leave the original at home. If you lose the original PR certificate, the Department will not re-issue such and only give you a letter of confirmation.
- Your South African ID book, should you be in possession of such.
Identity Book (ID) and driver’s licence
The ID book is used within the Republic for day-to-day identification purposes (banking etc.). Only holders of a permanent residence permit can apply for an ID book. We recommend that you apply for your ID immediately after your permanent residence permit has been issued at your nearest office of the Department. The law prescribes that you must apply within 5 years after the PR is granted.
The following documentation is needed:
- Form BI-9
- Form BI-1620
- 2 passport photographs
- Birth certificate
- Marriage certificate
- Divorce papers, death certificates if applicable;
- Proof of address
- PR Certificate: You are normally given a second, certified copy of the PR certificate. This one is used in a first step to verify your PR document that it is not fraudulent.
Officials have started to ask that you provide the originals of birth, marriage certificate etc. The Form BI-9 and BI-1620 must be used in original format and can be obtained from the Department. Currently, only the following DHA offices can assist new PR holders with the application for an ID Book: Swellendam, Citrusdal and Laingsburg.
It takes about 3 months to issue the ID book and the first one is free of charge. Please check after receipt that all your personal details are correctly recorded.
We recommend that once you obtained your ID, to apply as soon as possible for a driver’s licence at the nearest Traffic Department. After your permanent residence permit has been issued, you may not take longer than 5 years to apply for your driver’s licence. If you miss this deadline, it is possible that you will have to do your driver’s licence test again. You do not lose your foreign licence.
Please note that we cannot assist and apply for an ID book or a driver’s licence on your behalf. These are useful links:
Local bank accounts / loan applications
The PR Permit will enable you to become a “resident account holder“ with full access to all the banking products including loans. Send proof of your PR to your bank, so that they can convert your non-resident account to a resident account.
You can now claim back all the deposits that where related to the importation of your household contents, Telkom etc.
Registration with the local Municipality
Please note that there is no such registry in South Africa. If you have deregistered abroad, you may have to register with your home country’s Consulate in South Africa.
Life partners have to be present at application submission››
Spouse or life partner must be physically present on the day of application. From 1 February 2023, any spouse/life partner applications will require pictures of the spouse/life partner and the South African spouse must be present on the day of the application. Pre-2014 this was mandatory, and now the ruling has been reinstated.
Further, the letter of support can only be signed in front of the official and not beforehand.
Problems with loading VFS applications ››
Local applications for visas and permanent residence have to be done online via Visa Facilitation Services. The system also requires an appointment to be done and payment to be concluded.
Unfortunately, the online platform is extremely slow, unreliable and sometimes not even accessible. Please note that is sometimes can take us several days to load an application, because the system regularly crashes in the middle of an upload. We appreciate your patience when it comes to dealing with VFS.
New edition of our immigration book is available ››
Our book “South Africa – a practical guide for immigrants and investors” has undergone an update and version 39 is available in English and in German. The book is 88 pages and gives a detailed overview on immigration, tax, insurance and banking matters.
To obtain the book, please click here to order it online. Please note that the guide is only available as e-book and no printed versions can be sent out.
6. HEALTH INSURANCE
BDAE: Retired plan is underwritten by new insurer and premium adjustment ››
As of April 2023, Allianz Partners AWP Health & Life is the new insurer for the above mentioned plan. In addition, the premiums will be adjusted as follows:
Please note that the above contributions are the basic contributions and do not take into account any payment surcharges. The insurance conditions valid from 1 April 2022 can be found here: https://www.bdae.com/en/adjustment-expat-retired-2023
Please note that the above premiums are the basic premiums and do not take into account any payment surcharges. The terms and conditions valid from 1 April 2023 can be found here: www.bdae.com/en/adjustment-expat-retired-2023
The following table shows the monthly premium for the product sold in the past (“old” EXPAT RETIRED) that will apply from April 2023.
Please also note here that the above mentioned premiums are the basic premiums and do not take into account any payment surcharges. Due to the premium adjustment, you have the right of termination as of 31 March 2023. In order to meet the corresponding deadline, it is necessary to send us the notice of termination within one month from receipt of the letter that they will get from us. The regular notice period of one month to the end of the insurance year is not affected by this.
Please also note that we no longer offer EXPAT RETIRED for new business. As an optimised follow-up product, we have developed EXPAT INFINITY.
Please contact us should you require more information.
SwissSure sponsors Winelands Classic Golf Day at De Zalze ››
We were invited to take part in the popular Winelands Classic Golf Day.
Our company was represented on the 12th par 3 hole, where we sponsored a R 50’000 hole-in-one prize and a lucky draw. The hole-in-one prize remained unclaimed, but the lucky winner of the Bentley Drive for lunch to a wine farm of choice was won by Gerhard Erasmus – congratulations to the winner!
How to obtain your traffic register number as a foreigner ››
If you are a foreigner in South Africa and not yet registered on the eNaTIS (National Transport Information System) and you would like to purchase a vehicle, you must apply for a traffic register number, before you can register the vehicle in your name.
A traffic register certificate is an identification document that is issued by a state’s department of motor vehicles. The certificate lists the individual’s name, address, date of birth, gender, and driver’s license number. The certificate also includes a photograph of the individual and a physical description. The certificate is used to verify the identity of the driver when they are stopped by a police officer.
Obtaining a TRN as a tourist on a visitor visa is possible, although it requires certain effort:
Go the the nearest traffic Department with the following documents:
– Valid passport with Visa
– 2 passport photographs
– Proof of address
– Complete ANR form in original (click here to view copy)
Once you have submitted the form, you will then need to pay the required fee and wait approx. 6 weeks for the department to process your application. Once your application has been approved, you can collect your traffic register certificate at the department.