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Breaking news …..

SKYPE: hugo.van.zyl

Hugo van Zyl Contact Detail


Breaking news….

  1. New office numbers as of July 2014, for now use mobile number or the following SKYPE numbers
  • USA                   – + 1 818 924 5001
  • UK                     –  + 44 20 3239 7756
  • South Africa  – 021 813 9775 / 012 743 6564 or mobile above
  1. ATO Amnesty for offshore trusts – that is your SA Trust’s come out of jail card
  2. Just Do IT – The ATs’ Australian Campaign re offshore assets not fully disclosed
  3. Retired and living outside South Africa – think twice before your emigrate as your SA pension is now freely transferable i.e. neither a tax clearance nor a formal emigration is required. Pensioners Freedom






The ATO (the Australian Taxation Office) recently announced and published significant PROJECT DO IT information on the tax amnesty for foreign assets held in own or trust / entity name.

As of 1 March 2014, South Africans can now emigrate or exit their SA private company to be owned directly below an Australian trust or even better below an Australian Hold Co, either owned by an Australian trust or in certain cases as a subsidiary of a self managed Super.

More detail can be found on the more recent blog – just follow the link

Hugo may not advise on the Australian structure yet can ensure the trust is properly dissolved (where advisable and legal). I am Hugo van Zylquite willing to run this past the various families and what is important to IRM’s is that most South Africans in Australia incorrectly reported in SA and Australia i.e. they may need to do a VDP (voluntary disclosure or amnesty like) application in South Africa before or simultaneously with the ATO’s project DO IT.

Where there is a tax refund in SA, VDP will not be applicable as VDP is only where there is a tax due on revision or update.

Feel free to contact me should have questions.

See Me On TaxConnections

Debugging theNew Zealand tax amnesty on Foreign Superannuation Funds from South Africa

Debugging the IRD tax amnesty on Foreign Superannuation Funds from South Africa.

Synopsis for quick reading

The foreign investment fund (FIF) rules which intended to tax interests in foreign investments on an annual basis, was generally ignored by most immigrants. As of 1 April 2014 FIF and other complicated rules will no longer apply to interests in foreign superannuation

  •  South African Pension Funds as well as Retirement Annuity       Funds qualify as foreign Supers

·   IRD (the NZ version of the South African SARS) rules in respect of foreign lump sums are changing on 1 April 2014

·         Due to the changes NZ Government announced an amnesty that ends on April 1st yet, they have effectively extended this deadline to include all applications (o withdraw from the Super) were filed prior to 1 April 2014 provided the encashment date / entitlement or accrual is reported no later than in the 2014-15, i.e. lump sum must be encashed by 31 March 2015.

·         If you elect the amnesty only 15% of the lump sum is taxed and for the highest earners,  the effective tax rate is 5% on the lump sum, which is far less than the SA taxes withheld at source;

·         SA taxes qualify for a tax credit in NZ – effectively the amnesty will cap your IRD tax at the taxes paid to SARS on encashment

·         You can leave the funds in ZA Rand and transfer when, and if the exchange rate improves. No need to convert and send to NZ to qualify for the amnesty

·         If you elect not to use the amnesty, you need do nothing until you cash in, as there is no longer an annual IRD tax on unrealised FIF growth

·         You need not transfer to a Kiwi Saver but if you did,  you can withdraw  the IRD taxes from the Kiwi Saver

·         SA expats living in NZ for less than 4 years can continue to enjoy the “transitional resident rules” which provides for a 4-year exemption on SA lump sum and other income from SA sources.

·         As a general guideline, you need to be in NZ more than 7 years before the 15% amnesty inclusion rate is beneficial. On 7 years the effective tax rate is less than 5% whereas in the 8the year the effective rate jumps to near 7%. But this is not the only test to be done. If SARS taxed you at an effective rate of 25% (near R1.4m RA lump sum) then amnesty is probably not worth it until you reach your 18th taxed year in NZ i.e. 22 years of stay  (NZD 155 555 x 75.17 x 33.33% tax = NZD 38 973 which equals 25.05%). The minute any one of the monetary issues change the number of years could be substantially less.  For smaller amounts the number of years reduces substantially

·      Expressed differently: the new IRD foreign lump sum regime is so favourable, no SA expat living in NZ should could use the fear for additional IRD tax an excuse to delay claiming ownership of their cash bag trapped in SA RA fund.

 In short, it is time to speak to us. Ensure you consider the true facts, make the right decision and to ensure the magical 4 year tax exemption opportunity is not missed, and if you have been in NZ for more than 48 months consider the benefits of the amnesty and send that request to encash your SA RA or pension fund,   before 1 April 2014. Still unsure how to go about? Provide us with the necessary mandate and we can kick-start the process on your behalf, alternatively for a small fee we provide you with the template letter to be sent.



USA bank account? Be afraid, be very afraid

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For many years, whenever offshore tax avoidance issues are discussed, many South Africans suggested that having a bank account in Delaware or with any USA bank was rather safe from prying eyes. The USA was not tainted as a tax haven despite the Delaware arrangements.
A recent USA court ruling, slapping a USA bank on the fingers for trying to escape the IRS reporting requirements, makes for interesting reading.
This is the IRS way of thanking SARS for entering into signing the FATCA agreement negotiations.
BIG DADDY IS WATCHING – not even your Google account was safe from IRS/USA government. What made you think your USA bank account was safe?
Department of Justice Seal - Department of Justice Action Center
Department of Justice
Office of Public Affairs
Monday, January 13, 2014
Court Rejects Banking Associations’ Challenge to
Regulations Addressing Offshore Tax Avoidance

Today the District Court in the District of Columbia dismissed a challenge filed by the Florida Bankers Association and Texas Bankers Association challenging 2012 amendments to the Department of the Treasury’s interest-reporting regulations.  The regulations require U.S. banks to report to the Internal Revenue Service (IRS) information about accounts earning more than $10 of interest beginning in 2013 that are held by non-resident aliens of all countries with which the United States has a tax treaty or other information exchange agreement [Blogger adds: South Africa is included in this list!].  These new reporting requirements help the United States’ ability to comply with requests from its treaty and exchange partners and implement the Foreign Account Tax Compliance Act.

“This ruling advances the Department of Justice’s and Internal Revenue Service’s continuing efforts to pursue taxpayers trying to evade taxes through offshore accounts,” said Assistant Attorney General Kathryn Keneally of the Tax Division.  “The court’s opinion today represents an important step in our commitment to work with our treaty partners to eliminate cross-border tax evasion.” 

The court upheld the regulations’ 2012 amendments, finding that the IRS “reasonably concluded that the regulations will improve U.S. tax compliance, deter foreign and domestic tax evasion, impose a minimal reporting burden on banks, and not cause any rational actor – other than a tax evader – to withdraw his funds from U.S. accounts.”

The court’s decision affirms the IRS’ ongoing efforts to close the tax gap through cooperative measures with foreign governments, including the  2012 amendments. 

14-042                            Tax Division


Contact details for Hugo van Zyl

Our contact details

Office 0283122764 or Mobile 082 55 44831

Email  hugovz(at)iafrica.com


Where can we find Hugo van Zyl?


Yes many of you may have recognized Hermanus old Harbour. 

Tax advisor  Hugo van Zyl now residing in Hermanus, , yet he spends several days per month in Gauteng.

Mobile: +27825544831

Office:  +27283122764 – Hermanus

Home:  +2721 8139775 (Western Cape) or +27127436564 (Gauteng)

email: hugovz(a)iafrica.com

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