Financial Planning for South Africans moving to the UK

The UK is home to one of the largest South African communities outside South Africa. The 2021 Census recorded more than 230,000 South African-born residents across the UK, before including British-born family members, dual nationals or more recent arrivals.

South Africans moving to the UK often focus first on visas, jobs, housing and logistics. Financial planning is usually pushed further down the list until after arrival.

If possible, financial planning should ideally begin several months before relocation. Moving to the UK can affect how investments are taxed, whether South African advisers can continue advising you, how retirement planning works and which UK investment products become available once you become UK resident.

Conversations we’ve had with South Africans planning a move to the UK highlight that the biggest financial concerns are tend to be around pensions, investments, retirement planning and banking options.

Many people also begin encountering concepts they may not have fully considered before, including financial emigration, South African tax residency and how banking or investment structures may need to change once they are living overseas.

This article has been produced with our trusted partners at Alexander Beard South Africa and  looks at some of the key financial planning considerations South Africans should think about before leaving South Africa and after arriving in the UK.

Disclaimer

This article is intended as a general guide only and should not be relied upon as financial advice. Financial planning, pensions, investments and residency matters can become complex when multiple countries are involved. Rules, regulations and suitability vary depending on your circumstances. If you are unsure, it may be sensible to speak with a qualified specialist experienced in both South African and UK financial planning before making decisions.

Understanding South African financial emigration rules

When relocating abroad, whether to the UK or elsewhere, substantial portions of their wealth remain tied to South Africa for years afterwards due to rules around financial emigration from South Africa.

Under the current rules, South Africans need to be resident outside South Africa for at least three years before retirement assets can be liquidated and the funds then transferred to another country.

It’s therefore likely that someone may already be fully established in the UK while their long-term retirement assets remain in or connected to South Africa.

As a result, many South Africans continue managing UK-based lives while substantial investments and retirement products remain governed by South African rules.

This can create complications around how those assets should be managed during the waiting period if not carefully planned for.

The common option is to leave SA based investments where they are until they become compliant and clearer long-term plans emerge while others begin gradually restructuring available assets, reducing exposure to the SA rand or moving discretionary capital offshore over time where possible.

Retirement products often create the greatest complexity because they may continue requiring active management after the individual has physically emigrated.

The questions that need to be asked by SA expats should revolve around:

• Whether the underlying investments remain appropriate
• How much exposure should remain linked to the South African economy
• How future withdrawals may eventually be taxed
• Whether retirement planning should gradually shift towards UK-based structures instead
• Impact of exposure to currency fluctuations

This is why financial emigration planning is rarely just about moving money offshore. In practice, it is often about managing a gradual financial transition between two very different systems over an extended period of time.

What are the financial emigration rules?

The phrase “financial emigration” is still widely used by South Africans living abroad, but technically the system changed in 2021. The focus is less about formally “financially emigrating” through the South African Reserve Bank system and more about:

• Ceasing South African tax residency with SARS
• Complying with exchange control and tax rules
• Meeting the three-year non-residency requirement for access to certain retirement funds

The key rules and concepts are broadly as follows:

1. Ceasing South African tax residency

The starting point is determining whether you are still considered a South African tax resident.

SARS generally looks at:

• Whether South Africa is still your ordinary residence
• Where your permanent home and personal ties remain
• How much time you physically spend in South Africa
• Whether you have established permanent residency elsewhere
• Your long-term intention to remain abroad

Simply leaving South Africa does not automatically end tax residency.

South Africans moving to the UK eventually go through a formal process of notifying SARS that they have ceased to be South African tax residents. This is often still referred to informally as “financial emigration”, even though the technical framework changed.

2. The three-year non-residency rule

Since 1 March 2021, South Africans need to remain non-resident for South African tax purposes for an uninterrupted period of at least three years before they may access certain retirement interests early. This rule replaced the older “financial emigration” trigger system.

In practical terms, many South Africans move to the UK years before retirement assets can potentially be withdrawn or transferred offshore.

3. Exit tax/deemed capital gains tax

When someone ceases South African tax residency, SARS may treat certain worldwide assets as if they were sold the day before residency ceased which can trigger a deemed capital gains tax event, often referred to as “exit tax”.

Not all assets are affected equally, and South African immovable property typically remains within the South African tax net even after emigration.

4. Retirement funds are still taxed

Even after meeting the three-year rule, retirement withdrawals are not tax free in South Africa and lump sum withdrawals from South African retirement products are subject to South Africa tax rules.

5. Proof and compliance requirements

SARS and fund administrators usually require evidence that you:

• Ceased South African tax residency
• Remained non-resident for the full uninterrupted period
• Tax affairs are up to date

Evidence that SARS will look to review includes:

• Travel records
• Foreign tax residency evidence
• Visa or residency documentation
• Foreign tax numbers
• Proof of overseas address
• Tax Compliance Status (TCS) processes

It’s therefore important for anybody leaving South Africa to begin financial planning before moving to the UK rather than afterwards.

How the UK financial system differs from South Africa

It’s easy to underestimate how different the British financial systems are from those in South Africa, and that’s where a lot of our enquiries begin their discovery calls.

Regulatory complexity of managing SA based assets while living in the UK

A South African adviser may still be able to help manage certain South African investments, but they are not necessarily authorised to advise on UK-regulated investment products.

At the same time, UK advisers may not advise on South African products or structures they are unfamiliar with. This can leave some emigrants caught between two systems where neither side has visibility of the full picture.

Retirement planning and pensions

In South Africa, retirement planning is often centred around retirement annuities, preservation funds and discretionary investment portfolios.

In the UK, pension planning revolves around workplace pensions, SIPPs, annual contribution allowances and tax wrappers such as ISAs.

Due to the fact that South African retirement products typically remain in South Africa under South African rules, people often end up managing retirement assets across both countries simultaneously.

Banking and borrowing

Even financially successful South Africans may initially struggle to obtain competitive mortgages, loans or credit cards because UK lenders rely heavily on British credit history and local financial records.

Someone with substantial wealth or income arriving from South Africa effectively begin with no UK credit profile at all making it very difficult to access finance for property, opening bank accounts or getting other financial products.

Currency considerations

Holding financial assets in SA while spending and earning an income in the UK, currency and fx fluctuations become an important factor in decision making. Working with a specialist can help you determine:

• how much exposure should remain linked to South Africa
• whether investments still match future retirement plans
• when and how money should be transferred
• how exchange rate movements affect your long-term wealth

This becomes particularly important for people intending to retire permanently in the UK, where future living costs may exist entirely in pounds while significant investments remain tied to the South African economy and currency.

Differences between UK and SA tax systems

The UK taxes residents on worldwide income and gains, but also offers different allowances, pension structures and investment incentives compared to South Africa.

Products which may have been tax-efficient in South Africa are not automatically efficient once someone becomes UK resident, and products which are tax efficient in the UK may not be tax efficient under SA tax rules.

Common South African financial products and terminology and their closest UK equivalents

One of the more confusing aspects of moving to the UK is that many familiar South African financial products either do not exist in the UK or operate very differently once someone becomes UK resident.

While some broad equivalents exist, the tax treatment, regulation, contribution limits and long-term planning uses can differ significantly.

Financial checklist to complete before leaving for the UK

Before leaving South Africa, it’s essential to review your banking, investments, pension documentation and long-term financial plans while you still have easy access to providers and paperwork.

This checklist will help you ensure you’ve had discussions that will enable you to make financial decisions.

Review banking arrangements

Many South Africans only discover after moving that some banking services become harder to manage from abroad, therefore, before leaving confirm:

• Whether your accounts can remain open as a non-resident
• Whether online banking authentication will still work overseas
• Whether credit/debit cards will function internationally and potential costs
• How international money transfers will be handled
• Whether your residency status needs updating with the bank

Organise important financial documents

UK banks, mortgage lenders and investment firms often require extensive documentation for anti-money laundering and source-of-funds checks. This is easy for UK nationals living in the UK, but for foreign nationals, the checks become far more investigative.

Collecting the following documents which are likely to be requested later is much easier while you’re still in SA:

• Investment statements
• Bank and pension statements
• Proof of address(es)
• Tax references
• Proof of employment and income
• Evidence of savings or property sales

Review your investment structures before residency changes

Reviewing whether existing South African investment structures remain suitable after becoming UK resident is essential. This does not mean you need to close or move investments but residency changes can affect:

• Tax reporting of investments
• Adviser permissions when you move (i.e. will your SA advisor be able to advise you when you live in the UK)
• Can you use investment platforms from outside SA?
• Are your investments still suitable for a life outside SA?
• Estate planning and minimising inheritance taxes

Products that worked efficiently while living in South Africa may not always remain optimal after relocation.

Consider your currency transfer strategy

Exchange rates can have a significant effect on short and long term financial plans. Depending where your primary income comes from, the pound/rand exchange rate can influence:

• Rental/mortgage affordability
• Property deposits
• Savings transfers
• Spending and purchasing power
• investment values when converted between currencies

Some people transfer money gradually. Others maintain assets in both countries. Some wait for specific exchange rate levels before moving larger amounts.

Can you keep South African investments after moving to the UK?

In many cases, yes. However, becoming UK resident can affect how those investments are treated, taxed or managed. The issue is usually not whether the investments themselves are “good” or “bad”, but whether they still fit your long-term plans once you are living internationally.

Some investment providers may also have restrictions around servicing clients who become UK resident.

This is why many people eventually review whether their investment arrangements remain aligned with where they expect to live long term.

UK pension and retirement planning

The UK pension system is heavily built around tax incentives designed to encourage long-term retirement saving.

In the UK, pension contributions receive tax relief which means contributions into qualifying UK pension schemes are often made using income that would otherwise have been taxed.

In simple terms, this means that someone earning a salary in the UK may find that contributing into a pension will reduce the amount of income tax they pay while also building retirement savings for the future.

The UK system also allows many residents to contribute up to £60,000 per tax year into pensions before additional tax charges may apply, although this can reduce for very high earners.

Over time, this means pensions often become one of the most tax-efficient ways for UK residents to invest for retirement.

At the same time, South African retirement annuities and preservation funds do not automatically become UK pension products. The UK tax treatment of existing South African pensions can become complicated and will depend heavily on the type of product and the tax treaty between UK and SA.

Do South Africans need separate Wills after moving to the UK?

People moving internationally often assume their existing wills automatically cover everything globally. In reality, cross-border estate planning becomes more complicated once assets exist in multiple countries.

South Africans are likely to require specialist estate planning advice who can assist with complications arising from differences between SA and UK, residency and asset location.

How Experts for Expats can help

Experts for Expats can introduce South Africans moving to the UK to specialists experienced in cross-border financial planning, pensions, investments, mortgages and international wealth management.

This can help provide clarity around how financial life changes after relocation and which areas may need reviewing before or after arrival in the UK.

Can South African financial advisers still advise you after moving to the UK?

The UK has strict rules around regulated financial advice and once you become UK resident, some forms of investment advice may need to come from firms authorised by the Financial Conduct Authority (the FCA).

Advisers based overseas may not be permitted to advise on certain UK-regulated investments or pension products. This does not necessarily mean existing adviser relationships must end, but it can affect the scope of advice and product recommendations.

This is why many South Africans moving to Britain choose to speak with a specialist who understands both systems and how they interact together.

That can help provide clarity around:

• How South African retirement products should be managed after leaving
• When assets may potentially become transferable offshore
• Whether existing investments still remain suitable
• How UK tax residency affects South African investments
• How retirement planning changes once living permanently in Britain
• Which UK investment structures may become available after relocation
• How currency exposure may affect long-term financial planning

Getting advice to understanding how to gradually transition from a South African financial life to a UK-based one can reduce stress and avoid creating unnecessary complications, tax problems or long-term planning mistakes.

Common questions we get asked by South Africans moving to the UK

Can I open a UK bank account before arriving?

Some banks allow accounts to be opened before arrival, particularly through international banking divisions or digital banks, but many still require proof of a UK address before full access is granted.

Can I still contribute to a South African retirement annuity while living abroad?

In some cases, yes. However, whether this remains beneficial depends on your long-term residency plans, UK tax position and overall retirement strategy.

Will the UK tax my South African pension?

Potentially. The UK taxes residents on worldwide income, but the exact treatment depends on the type of pension, how withdrawals are taken and the UK-South Africa double taxation agreement.

Can I keep my South African bank account after emigrating?

Often yes. Many South Africans continue using local bank accounts for investments, property income, retirement products and transferring money between countries after relocating abroad.