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International investments – Consider tax implications

South Africans are overburdened with taxes, and it’s only set to get worse. If you or your clients are considering investing internationally, you should be aware of the tax requirements when deciding on the best investment approach.

This is according to Gavin Smith, senior area manager at deVere Acuma, a global financial solutions company, who says that the continued increases on an already heavily taxed consumer base is good enough reason for South Africans to seriously seek out international investment opportunities.

The 2019 Budget proposals are estimated to raise tax revenue by R15 billion in 2019/20, and further changes are proposed to raise an additional R10 billion in 2020/21. The consistent revenue shortfall will require further tax policy interventions, and the proposed National Health Insurance (NHI) bill will also increase taxes on South Africa’s economically active citizens in future.

There are a number of benefits linked to international investment opportunities, but Smith advises that investors should consider how offshore investment taxation works as an initial step.

In a recent media release, he explains that the first choice you will be faced with is whether you are using a rand-denominated offshore unit trust facility – also known as an asset swap – or investing directly in offshore unit trusts.

Click here to download the media release.

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