February 09, 2026
Navigating 2026 Offshore Allowances: SDA Relief Explained
As we enter 2026, it’s important to revisit the annual allowances available to South African residents and ensure you’re making the most of these opportunities while remaining compliant with the latest regulatory requirements.
Significant updates from the South African Reserve Bank (SARB) have introduced more flexibility for certain types of transfers, making it essential to understand how these changes affect your financial planning for the year ahead.
This updated guide breaks down your annual allowances and explains the pivotal new SARB concessions that may simplify your offshore transfers this year.
Understanding Your 2026 Annual Allowances
South African residents continue to have access to two primary annual allowances, though the process for exceeding these limits has recently been refined by the South African Reserve Bank.
1. Single Discretionary Allowance (SDA)
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- This allowance permits individuals to transfer up to R1 million per calendar year offshore without prior approval from the South African Revenue Service (SARS) or the South African Reserve Bank (SARB).
- It can be used for travel, gifts, investments, or other purposes.
2. Foreign Capital Allowance (FCA): for Larger Offshore Investments
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- In addition to the SDA, individuals can transfer up to R10 million per calendar year offshore for investment purposes.
- This allowance requires a specific tax clearance certificate from SARS for foreign investment.
Note: Capital transfers (investments, loans, or gifts) exceeding your R1 million SDA must still utilise this allowance and require the SARS AIT PIN.
3. Special Approval Applications
It is possible to externalise amounts greater than the combined value of your SDA and FCA allowances by making a special approval application to the SARB.
What’s Changed? SARB Eases Requirements for Certain Transfers
The New Rule: When Transfers Can Exceed the SDA Without SARS Clearance
As of February 2026, the South African Reserve Bank (SARB) has updated the Single Discretionary Allowance (SDA) regulations. Current account transfers that exceed the R1 million SDA are now permitted without a SARS AIT PIN, provided that specific SARB approval is granted. This relaxation is designed to simplify the payment of recurring or essential overseas costs.
Strict controls remain for capital transfers, and the changes apply to South African residents over 18, including those temporarily abroad.
Current vs Capital Transactions: How SARB Classifies Your Transfers
The SARB now permits transfers exceeding the R1 million SDA without a SARS AIT PIN, provided you obtain specific SARB approval. However, this is strictly defined by the nature of the transaction:
Examples of Current and Capital Transfers
- Current transfer: School fees, living expenses, subscriptions, travel costs (No SARS AIT PIN required with prior SARB approval)
- Capital transfer: Offshore investments, loans, gifts to non-residents (SARS AIT PIN, Standard FCA process)
Key Compliance Requirements:
To utilise this new concession, the SARB requires a formal application process:
- Motivational Letter: A letter addressed to the SARB must confirm that the R1 million SDA has been fully utilised.
- Formal Request: The letter must explicitly request approval to proceed with additional payments under the “current” transfer category.
- Supporting Documentation: The SARB may request invoices, statements, or itineraries to validate the purpose of the remittance.
This approval applies strictly to current account transfers. It includes, but is not limited to:
- Living expenses
- International subscriptions
- Tuition and school fees
- Travel-related costs
Please note: Capital transfers (investments) remain excluded from this specific approval process. Understanding the distinction between current and capital transfers is essential to ensuring regulatory compliance and avoiding payment delays.
Planning Your 2026 Offshore Strategy
The 2026 landscape offers new flexibility for residents managing overseas expenses. By starting your planning early, you can avoid the stress of last-minute applications and ensure your offshore transfers are handled efficiently.
At Currency Partners, our team can assist you with:
- Complimentary tax clearance certificate
- Ensuring compliance with exchange control regulations.
- Dedicated dealing to help you manage currency risk by securing exchange rates in advance.
- Local and international cash management accounts.
Whether you are funding an international education or building a global investment portfolio, our team ensures your transfers are compliant, cost-effective, and efficient.
Contact us today to discuss your annual allowance needs and let us guide you through every step of the process.
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