Question:
If we decided to immigrate as pensioners (70 & 67 years old) and wanted to take all our capital with us (living annuities, savings & house sale proceeds, in fact the “whole bang shoot”) what percentage rate of taxation on the whole amount (on a one off basis) would SARS penalize us for? Remember we are already pensioners receiving a monthly pension at over 65 rates.
Answer:
Ray, This questions straddles other areas of the tax law, that do not fall under our area of expertise. For a definitive answer, you should consult a tax specialist. But in broad terms, the following will apply: your living annuity will be taxed upon emigration according the lump sum annuity tax tables (net of any lump sum tax beaks you may already have received). In the worst case, you will pay 36% tax on the balance of your living annuity. Your other assets (house, other investments) will subject to capital gains tax at the rate of 33.3% of your marginal tax rate (SARS equates emigration with asset disposal). So if your marginal tax rate is, say, 24%, the profit portion of your asset will effectively be taxed at 8%.
