Families-with-assets-overseas

Assets and family outside SA, trusts and tax

South African families who have created South African as well as foreign trusts may be living all over the world.

Similarly, foreigners who have foreign trusts may be living in South Africa. The use of foreign trusts has been the subject matter of legislative intervention over the years. South African exchange controls were relaxed a number of years ago, allowing South Africans to invest offshore, many in so-called tax haven countries that impose zero or low rates of tax on trusts.

Although it is useful for South African residents to have foreign trusts in which offshore assets are held, the largest drawback is the substantial cost involved in the registration and administration of those foreign trusts. Generally, the administration costs pertaining to foreign trusts are substantially higher than those of South African trusts, which has discouraged people from using these structures.