Retiring In South Africa

The advent of the Immigration Amendment Act number 19 of 2004 and the new Immigration Regulations gazetted into effect under Government Notice 27725 on 1 July 2005 has heralded in a very different scenario in terms of making South Africa a retirement destination of choice.

Retiring In South Africa
 
A Perspective In Terms of the Immigration Amendment Act and New Immigration Regulations
 
Julian Pokroy
Chairperson: Law Society of South Africa’s and Law Society of the Northern Provinces Immigration Law Specialist Committees and is a member of the Immigration Advisory Board to the Minister of Home Affairs.
The advent of the Immigration Amendment Act number 19 of 2004 and the new Immigration Regulations gazetted into effect under Government Notice 27725 on 1 July 2005 has heralded in a very different scenario in terms of making South Africa a retirement destination of choice.
The requirements as set out in Section 20 of the Amendment Act provide that a retired person may be issued with a temporary residence permit for a period exceeding three months (the ceiling of a visitors permit being three months) but not exceeding a period of four years and which is renewable one or more times.
The qualifying persons defined in Section 20 of the Immigration Act as amended are persons proving that they have:
·        the right to a pension or an irrevocable retirement annuity or a retirement account providing that person with a minimum payment, prescribed in the Regulations, for the rest of his or her life and emanating from his or her country of origin;
·        a minimum prescribed net worth as set out in the Regulations.
·        the requirements as set out in the amended Regulation 17 regarding retired person’s permits are as follows:
·        the amount referred to in terms of a pension or retirement annuity shall be R20 000.00 per month. The Department of Home Affairs is interpreting this to mean a per capita amount i.e. spouses would have to show
·        R40 000.00 per month;
·        a net worth constituted from a “combination of assets” delivering an income of R20 000.00 per month. Again the Department of Home Affairs is interpreting this to mean a per capita amount of R20 000.00 per applicant. No specific capital amount or investment is dictated, neither is the concept “a combination of assets” defined. It is only the income deriving there from that is specified;
·        payment of a deposit equivalent to the cost of a single airline ticket from South Africa to the retiree’s country of departure. This deposit is repayable to the depositor after their final departure from South Africa or after they have obtained permanent residence in South Africa. The payment of this deposit may be effected by means of a bank guaranteed cheque payable to the Department of Home Affairs or credit card at places where such facility exists;
·        a Yellow Fever Vaccination certificate must now be provided if the retiree has or intends travelling from or through a Yellow Fever endemic area;
·        the retiree must submit a Police clearance certificate and Medical and Radiological Reports.
It has been stated above that the R20 000.00 per month requirement is being interpreted by the Department of Home Affairs, with regional offices expressing differing opinions in this regard. Regulation 17 is silent on the point and it can be argued either way as to whether the amount is per applicant or per spousal couple. Part J of the Application form for Temporary Residence in South Africa relates to retired persons permits and lists the monetary requirements as follows: “proof of a pension fund or an irrevocable retirement annuity or a net worth or a combination of assets realizing a minimum amount of R20 000.00 per month per retired person”.
The Department of Home Affairs is arguing that if only one spousal retiree qualifies with a pension of not less than R20 000.00 per month, then the remaining spouse i.e. the spouse not have such pension or income would have to apply in the relatives permit category for the right to accompany his or her spouse. The definition of relative in the Immigration Amendment Act is linked to the definition of “immediate family” and a spouse by virtue of the link by marriage would fall into the definition of“relative”.
If it was the intention of the Minister of Home Affairs to make it potentially more difficult to apply for a retired persons permit then she certainly has succeeded in doing so. A doubling up of the monetary requirement of pension or retirement annuity has put paid to many potential retired persons permit applicants, many of whom qualified up to the end of June 2005.
It is my belief that this matter should be looked into urgently with a view to revising the monetary requirement qualification in this category.
On a positive note, the capitalization requirement of R 12 million in the financial net worth leg of the retired persons category has been removed and replaced with the “combination of assets” requirement, delivering R20 000.00 per applicant.
As the concept “combination of assets” has not been specifically defined it will consist of inter alia the following:
·        Immovable/fixed property, situated anywhere in the world;
·        Rental income from fixed property;
·        Income from investments or shares.
The crux will therefore be the ability to demonstrate by way of authentic documentation, the ability to generate the acquired income.
An interesting development in terms of retirees wishing to apply for permanent residence in South Africa is the reduction in the amount which can be paid to the Director General of Home Affairs to secure permanent residence in this category. In essence Section 27(f) of the Immigration Amendment Act read together with regulation 23(11) of the new Regulations provides, in addition to the normal pension or annuity requirement, that an applicant who qualifies with a net worth of not less than R7.5 million, can apply for permanent residence in this category by making a payment of R75,000 to the Director-General of Home Affairs upon approval of their permanent residence application. This is in line with a similar provision in the Australian immigration regulations.

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