SwissFin – SwissSure Newsletter March 2024

Dear Readers,

We welcome you to our first Newsletter for 2024.

The recent budget speech by our finance minister is the main topic in this circular. The government’s decision to reduce debt by accessing the profits on South Africa’s gold and foreign exchange reserves, creates fears that the Reserve Bank’s independence is at risk.
Please find more information further below.

As a novelty to our newsletter, we will regularly publish the investment outlook of our Swiss partner, Sonnenberg Wealth Management.
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-2024/.

Enjoy the reading, with best regards,
Your SwissFin / SwissSure – Team

 

1. INVESTMENTS

• Interest rates: Bank deposits, insurance plans, tax-free investment amounts and our foreign exchange rates
• Sonnenberg Wealth Management’s investment outlook

2. LOCAL AND INTERNATIONAL FINANCIAL NEWS

• South Africa says goodbye to another 100 businesses
• Reserve Bank keeps interest rates on hold

3. TAXATION

• Budget Speech highlights

4. SWISSSURE: SHORT-TERM INSURANCE NEWS

• The worst areas for hijacking in South Africa – and the types of cars criminals are after
• MUA’s contact number for assistance services
• CIA body corporate insurance – Alternative Energy Installations
• Santam: Amendments to the insurance of geysers
• MUA adjusts car hire premiums
• OMI implements measurements against vehicle theft
• TRA changes insurance carrier

5. IMMIGRATION

• Big win for work visas in South Africa
• Make sure you have an exit stamp in your passport
• Automatic extensions of pending visas
• New immigration regulations amendments in the pipeline

6. HEALTH INSURANCE

• BDAE: Premium adjustment for the international health insurance EXPAT RETIRED

7. OTHER

• SwissSure sponsors Atlantic Beach Golf Club Championships
• Voting day is the 29th May
• 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 2024:

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: ››

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 ››

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.

Should you wish to receive more information on our money market fund offering, the tax-efficient income plans or our forex rates please contact Mr. Tony R. Hug on .

Sonnenberg Wealth Management’s investment outlook >>

As mentioned in the introduction, we are proud to share the investment outlook of our Swiss partner company.
Please click here to read the interesting documentation.

South Africa says goodbye to another 100 businesses ››

South Africa has seen 109 businesses close down in the first month of 2024, showing a massive 35% increase from the same time last year.
According to Stats SA’s latest data on liquidations in the country, the total number of liquidations increased by 34.6% in January 2024 compared to January 2023.
Liquidations of companies increased by 28 cases, while liquidations of closed corporations remained unchanged during this period.

However, while this represents a sharp rise in liquidations year-on-year, the total number of liquidations decreased by 3.9% in the three months ended January 2024 (November 2023 to January 2024) compared with the three months ended January 2023.
The majority of liquidations were on a voluntary basis, but 11 were compulsory.

Looking at the liquidations by industry, the biggest portion of closures were unclassified, but of those that could be classified, most were in the financing, insurance, real estate and business services sectors. This was followed by the trade, catering and accommodation sector.

Reserve Bank keeps interest rates on hold ››

In a welcome improvement for South African consumers, annual consumer price inflation, as measured by the consumer price index (CPI), pulled back in December, easing to 5.1% from 5.5% in November. Core inflation (excluding the more volatile price categories of food, fuel and electricity prices) remained steady at 4.5%. Against this backdrop, as expected, the SARB cautiously kept the repo rate on hold at 8.25% at its first meeting for the year on 25 January, with the prime rate remaining at 11.75%.

Budget Speech highlights ››

Finance minister Enoch Godongwana managed to set out a plausible path to halt SA’s public debt spiral with the help of profits on the foreign reserves. He presented his budget on 21 February 2024 and this is a brief summary:

• Tax revenue collections for 2023/2024 is now expected to total R1.73 trillion, which is R56.1 billion less than the expected in the 2023 Budget. The shortfall is largely due to the decline in corporate profits and revenue from mining.
• The estimated Real GDP growth of 0.6% in 2023, is down from 0.8% growth during the 2023 Medium Term Budget Policy Statement (MTBPS).
• Government has provided Transnet with a R47 billion guarantee facility to support the entity’s recovery plan and meet its immediate debt obligations.
• The consolidated budget deficit is projected to narrow from 4.9% of GDP in 2023/2024 to 3.3% by the end of the 2024.
• The national debt currently is estimated to stand at R4.3 trillion. Debt-service costs in 2023/2024 have increased by R15.7 billion to R356 billion. Debt-service costs will absorb more than 20% of Revenue.
• Personal income tax brackets remain unchanged. The primary, secondary and tertiary rebates also remain unchanged.
• Excise Duties on alcohol will increase in line with expected inflation between 6.7% and 7.2% and tobacco will increase between 4.7% and 8.2%. There will be an increase on the Excise Duty on electronic nicotine and non-nicotine delivery systems known as “vape” from R2.90 per millilitre to R3.40 per millilitre.
• Carbon Fuel Levy: Increased to 11 cents per litre for petrol and 14 cents per litre for diesel. Effective 3 April 2024.
• The following taxes and rebates remain unchanged: Estate duty, donations tax, transfer duty, capital gains tax, corporate income tax rate, fuel levy, road accident levy, medical schemes credit and VAT.

Comment:
The 2024 Budget is kind to South Africans, with no new major tax increases, the fuel levy remaining flat and a one-year extension in the Social Relief of Distress (SRD) grant, which is not a surprise with elections just a few months ahead!
The biggest story out of the Budget is the R150 billion withdrawal from the Gold and Foreign Exchange Contingency Reserve Account (GFECRA), to reduce South Africa’s debt service costs through a reduction in borrowing. Due to the weakening of South Africa’s exchange rate, the value of the reserves in Rand terms increased from R1.8 billion in 2006 to R 507.3 billion at the start of this year. The last settlement of this kind was done in 2003.

The worst areas for hijacking in South Africa – and the types of cars criminals are after ››

South Africa has seen an increase in hijackings year-on-year, with some provinces experiencing a bigger jump in hijackings than others.
Presenting the latest quarterly crime statistics for the third quarter of the year – October to December 2023 – the South African Police Service (SAPS) noted that 5973 cars were hijacked over the three-month period.
This equates to approximately 66 cars being stolen daily, a 6.5% rise from the same period in 2022.

According to the SAPS, three provinces experienced a notable year-on-year increase (>10%) in hijackings – these being the Gauteng (14.4%), the Western Cape (14%) and North West (11%). Interestingly, Kwa-Zulu Natal saw a 17.6% decrease in carjackings, followed by the Eastern Cape (-5.2%). Carjackings are most prevalent in South Africa’s most populous regions, such as Gauteng, KwaZulu Natal, and the Western Cape.
Gauteng saw 3010 hijackings, representing 50.4% of all carjackings in Q3 2023/24. the Western Cape experienced 856 carjackings, and Kwa-Zulu Natal saw 834.

The top hijacking hotspots for the three most populated provinces are listed below.

Gauteng: Ivory Park, Moroka, Loate, Orange Farms and Eldorado Park.
Kwa-Zulu Natal: Umlazi and Mariannhill.
Western Cape: Philippi East, Harare, Nyanga, Mfuleni and Delft.

Please do not drive through or close to these areas and stay safe!!

MUA’s contact number for assistance services ››

Should you have trouble reaching our MUA Value Added Services (Road Assist, Home Assist or Concierge) on 0861 000 682, please dial 076 715 8967 for assistance. It has recently come to our attention that the MTN Network is not connecting to Toll Free numbers and should the policyholder be unable to reach any of the above numbers, please use 0871101480. Your convenience and satisfaction remain our top priority!

CIA body corporate insurance – Alternative Energy Installations ››

We have seen a severe increase in fires caused by inverters and lithium batteries. In many instances these sometimes devastating fires can be attributed to the incorrect installation of these systems.
To simplify the procedure and ensure the correct installation of these systems the following will be applied by CIA with immediate effect on new business and policy endorsements from renewal date April 2024:
– Systems will be underwritten according to the storage and generation capacity. For Community Living policies cover will automatically be included for systems 6kw or less per unit.
– For Homeowners and Broadform Building policies cover will automatically be included for systems 11kw or less.
– Systems larger than these will only be covered if declared and specified in the policy schedule.
For systems larger than specified in the warranty, a questionnaire must be completed before the system can be added to the policy. Please click here if you are a CIA policyholder to read the warranty.

Santam: Amendments to the insurance of geysers ››

The insurer has changed the handling of geyser claims. If you are a Santam policyholder, please click here to read the circular.

MUA adjusts car hire premiums ››

Effective from 1 May 2024, there will be an increase in car Hire Premiums for both new business and for existing policies, the adjustment will be applied at the renewal date starting on 1 May 2024. You can click here to see the new rates.

OMI implements measurements against vehicle theft and insurance fraud ››

The insurer is clamping down on insurance fraud. In future, policyholders will be contacted directly, in order to validate claims – please click here to read the circular.
In addition to the above and in line with most other insurers, certain vehicles now require a compulsory tracking device. Please click here to see the list of vehicles.

TRA changes insurance carrier ››

F&I Insurance & TRA will be changing Insurance carriers for their commercial clients from the 1st of April 2024. Please click here for the letter regarding the change.

Big win for work visas in South Africa ››

South Africa aims to attract foreign investors by accelerating the issuance of work permits for foreign executives and technicians employed by the largest companies in the country.

As part of the Trusted Employer Scheme pilot introduced in October, work permit processing times will be reduced to 20 days instead of 22 weeks, according to the Department of Home Affairs.

The Southern African-German Chamber of Commerce and Industry – representing companies operating in South Africa, including Volkswagen and Bayer – has previously stated that the difficulty of securing work permits is limiting investment and endangering 100’000 jobs in the country.

“This scheme will allow South Africa to more easily attract skills and manage immigration, particularly in processing applications for senior executives, technical personnel, corporate employees and investors,” said Aaron Motsoaledi, South Africa’s Home Affairs minister.

Make sure you have an exit stamp in your passport ››

Whenever you leave the Republic, please check that you have received an exit stamp in your passport. If not, you are deemed to be still in the country and will create confusion and explanation requirements when you return back to South Africa.

Automatic extensions of pending visas ››

As usual, the minister only published the automatic extensions at the last minute before last Christmas. Applicants waiting for long-term visas were allowed to continue to stay in the Republic, but short-term visitor extensions submitted before the end of November 2023 did not qualify and applicants had to leave South Africa before the end of February 2024.
Please click here to read the concession document.

New immigration regulations amendments in the pipeline ››

On the 8th of February 2024, the Minister of Home Affairs published a draft second amendment to the 2014 Immigration Regulations for public comment. Among the notable proposals are the introduction of the Remote Working Visa and certain modifications to the Critical Skills Visa. While these changes represent positive steps forward, some aspects of the proposals appear to lack thorough consideration or alignment with the South African economic context.
Remote Working Visa
The draft Regulations propose extending Section 11(2) work authorization to encompass remote work for foreign employers. The amendment introduces a minimum annual income from abroad equivalent to not less than 1 million rand. This visa can be valid for up to 3 years, with individuals staying in the Republic for over 12 months in a year required to register with the South African Revenue Service.
The surge in remote working post the COVID-19 pandemic has led several countries to introduce visas allowing remote work within their borders. Most of these countries impose minimum income requirements consistent with their general financial means criteria for all visas. However, the proposed annual threshold of 1 million rand, or R 83’000 per month, stands as one of the highest globally, surpassing even the estimated cost of living in some of the world’s most expensive countries.
Proposed Changes to the Critical Skills Visa
Another welcomed change is the proposed amendment to Regulation 18(5)(b), addressing the challenge of obtaining Professional Body registration. Currently, regulations mandate applicants to secure registration with an accredited professional body and obtain a skills confirmation letter from that body. However, some professional bodies require applicants to possess a work visa before membership, creating an obstacle to entry for much-needed skills.
Work visa
A curious addition is the proposed introduction of a point-based system to the Work Visa scheme. The Regulations suggest using a points-based adjudication system based on criteria determined by the Minister, including age, qualifications, language skills, work experience, employment offers, and adaptability within the Republic. However, the regulations lack clarity on how this system will function or the sufficient point threshold.
Although a points-based immigration system is not new and has been successfully implemented in countries like Australia, the UK, and Canada, clarity and national consensus are crucial.

BDAE: Premium adjustment for the international health insurance EXPAT RETIRED ››

The insurer is increasing the rates on the above mentioned plan with effect from 1 April 2024.

The following overview shows the monthly premium for EXPAT RETIRED BASIS valid from April 2024. The good news is that the premiums for the supplementary modules EXPAT RETIRED R-PLUS, EXPAT RETIRED R-DENT and EXPAT RETIRED R-TOP remain unaffected by this adjustment.

Age	EXPAT RETIRED BASIS
up to 50	263 Euro
from 50	362 Euro
from 65	456 Euro
from 70	551 Euro

Please note that the above-mentioned premiums are basic premiums and do not include any payment surcharges.

Please also note that the BDAE no longer accepts any new business for the EXPAT RETIRED. The EXPAT INFINITY as an optimized follow-up product, which you can find out more about by contacting Tony R. Hug – .

SwissSure sponsors Atlantic Beach Golf Club Championships ››

We were invited to take part in this year’s club championships.
Our company was represented on the 14th par 3 hole, where we sponsored a R 50’000 hole-in-one prize, which remained unclaimed.

Voting day is the 29th May ››

Finally, our president announced the long-awaited election day. The 29th May will be a public holiday and most citizens are hopeful that a new government will be voted in.

We value your comment ››

Do you want to know about a specific topic, share something with us or comment?
Please feel free to send us an e-mail or so that we can assist you.