New Zealand - The Good, The Bad and The Ugly.

[hayleyearth]

1 hour ago, davetapson said:

So awesome.

We're facing winter in a 70's ( not particularly insulated) house and I'm thinking why are we doing this to ourselves?

We are in a cottage built before 1940, one of the originals on the Bucklands Beach peninsula, it was 12° inside the other morning at 9am... It's not even winter yet. 

We are moving out on the 22 June (eventually after many delays). Looking forward to some warm and dry house! 

(Pic was a couple of weeks back, the house is basically windows!)

[davetapson]

3 hours ago, hayleyearth said:

We are in a cottage built before 1940, one of the originals on the Bucklands Beach peninsula, it was 12° inside the other morning at 9am... It's not even winter yet. 

We are moving out on the 22 June (eventually after many delays). Looking forward to some warm and dry house! 

(Pic was a couple of weeks back, the house is basically windows!)

Another so awesome!!  Congratulations guys, it's nice to see the Saffas coming right...

 

[patches]

23 hours ago, Wayne Potgieter said:

Side note. I paid the last progress payment on our new Orewa home last night. The big move is in 2 weeks. Was so excited that I drove to the house that is now legally mine (and sorta ANZ bank) and filled the spa pool.

 

That's awesome! It's so scenic around there too! Wishing you guys many happy years in the new home!

[patches]

I took the plunge and listed my wife’s Polo on a $1 TradeMe auction…

it’s worked for me in the past. Hopefully it does now or I’ll there may be a few nights on the couch 😅

https://www.trademe.co.nz/a/motors/cars/volkswagen/polo/listing/3596191956?bof=r2xal3Ji

[davetapson]

3 hours ago, patches said:

I took the plunge and listed my wife’s Polo on a $1 TradeMe auction…

it’s worked for me in the past. Hopefully it does now or I’ll there may be a few nights on the couch 😅

https://www.trademe.co.nz/a/motors/cars/volkswagen/polo/listing/3596191956?bof=r2xal3Ji

Looks like it's flying.

 

[patches]

On 5/14/2022 at 11:55 AM, davetapson said:

So awesome.

We're facing winter in a 70's ( not particularly insulated) house and I'm thinking why are we doing this to ourselves?

 

On 5/14/2022 at 1:21 PM, hayleyearth said:

We are in a cottage built before 1940, one of the originals on the Bucklands Beach peninsula, it was 12° inside the other morning at 9am... It's not even winter yet. 

We are moving out on the 22 June (eventually after many delays). Looking forward to some warm and dry house! 

(Pic was a couple of weeks back, the house is basically windows!)

Our 1950's bungalow does surprisingly well, now that I've replaced the ceiling insulation in all-but-one room (a project for another weekend). It does get a lot of natural light, and we do run the heat pump occasionally (aircon for those not fluent in Kiwi speak).

Typically our monthly energy bills are:

• Electricity - $60 (spring, summer autum average) - $90 (worst case winter + wife working form home with heatpump on all day)
• Gas - $60 (for hot water & stovetop)

Haven't got double glazing, underfloor or wall insulation though, and in the event that my dreams come true and we move to the South Island, we won't sell up in Auckland so may have to put a fair bit of money in to meet the Healthy Home standard for prospective tennants.

[davetapson]

1 hour ago, patches said:

 may have to put a fair bit of money in to meet the Healthy Home standard for prospective tennants.

Our house seems to have several exclusions i.e. no insulation under floor because 'impractical to fit'. Practicality it seems is in the eye of the beholder. It does have that foil stuff so haven't fought them over that. Yet. Landlord is pretty good.

[patches]

35 minutes ago, davetapson said:

Our house seems to have several exclusions i.e. no insulation under floor because 'impractical to fit'. Practicality it seems is in the eye of the beholder. It does have that foil stuff so haven't fought them over that. Yet. Landlord is pretty good.

Well that is part where many take issue with the Healthy Homes Standard. In a number of cases getting houses up to the prescribed standard isn't practical. Adding heat-pumps seems to be the easiest fix, but then landlords find that their tenants don't even use them as they don't want higher power bills.

A lot of the time the upgrades that landlords implement translates into increased rent, and when asked, many tenants in lower income households would rather have the option to rent a cheaper place because it doesn't have a heat pump etc.

Then there's the fact that why is it ok for an owner to live in almost any form of leaky/damp/draughty/cold building, but not for a renter?

[davetapson]

Law of unintended consequences, something that social minded govts step into on a regular basis.

We live in a multi-story house running up a slope - monster gas heater at the bottom at the entrance door. Turn it on and it turns the house into chimney - you can feel the got air rushing up and out, helping mostly global warming and to a lesser extent, us.

[Wayne Potgieter]

On 5/15/2022 at 9:33 AM, patches said:

I took the plunge and listed my wife’s Polo on a $1 TradeMe auction…

it’s worked for me in the past. Hopefully it does now or I’ll there may be a few nights on the couch 😅

https://www.trademe.co.nz/a/motors/cars/volkswagen/polo/listing/3596191956?bof=r2xal3Ji

Looks like the price has risen nicely...

[patches]

Just now, Wayne Potgieter said:

Looks like the price has risen nicely...

haha yeah, I'm safe from the couch... for now!

[Steven Knoetze (sk27)]

6 hours ago, patches said:

haha yeah, I'm safe from the couch... for now!

What was the price in mind before the auction, out of interest?

 

[patches]

On 5/20/2022 at 5:37 PM, Steven Knoetze (sk27) said:

What was the price in mind before the auction, out of interest?

 

I had a Buy Now of $9,990 listed for anyone quick to the party that didn't want to get into a bidding war.

Will be interesting to see if it exceeds that Buy Now price?! Most of the other things I have sold this way, exceed the Buy Now at auction.

[Wayne Potgieter]

On 5/23/2022 at 10:21 AM, patches said:

I had a Buy Now of $9,990 listed for anyone quick to the party that didn't want to get into a bidding war.

Will be interesting to see if it exceeds that Buy Now price?! Most of the other things I have sold this way, exceed the Buy Now at auction.

Looks like you got a tidy bit more than your original asking price there Patches...

[hayleyearth]

Who of you have NOT done financial immigration from SA?

If you have not financially immigrated, but also have no bank account there anymore with no income or expenses have you done SARS filing?

Have you even actually still logged into SARS?

 

If you have not financially immigrated and have bought a house here, what did you put on your "tax residence form" from the bank?

 

 

Urgh... I'm confused!

[patches]

35 minutes ago, hayleyearth said:

Who of you have NOT done financial immigration from SA?

If you have not financially immigrated, but also have no bank account there anymore with no income or expenses have you done SARS filing?

Have you even actually still logged into SARS?

If you have not financially immigrated and have bought a house here, what did you put on your "tax residence form" from the bank?

Urgh... I'm confused!

I haven't financially immigrated from SA, but I do still keep an account open there and put money into it (for family) each month.

About 2.5 years ago I contacted a financial emigration consultant to see what was required and their response indicated that for me, there wasn't much to do, as I have broken SA tax residency (different from financial financial migration)

Below is the email they sent me. Hopefully that clears things ups  a little: 

Quote

 

"[Previously], a South African tax resident is exempt from paying tax in SA on any money earned as an employee overseas if you are out the country for 183 full days in a 12-month period (of which at least 60 of those days must be consecutive).

However, [the new] amendment [which came] into force from March 1 2020 will affect certain South Africans who have moved or are working overseas. The government has proposed amending the legislation to the effect that money earned up to R1m per tax year will be exempt; any amount earned overseas over the R1m will be subject to possible taxation in SA.

If you are working or living overseas you should consider how this may affect your circumstances so as not to be caught out by this amendment.

Tax residency

The general rule is that anyone who considers SA their home is a South African tax resident. So, if you were born in SA and live in SA you will be a South African tax resident.

However, if you leave SA with the intention of moving permanently to another country, chances are that you are no longer tax resident in SA. This process is called breaking tax residency and is primarily determined by your state of mind. The South African Revenue Service (Sars) has, however, provided indicators to assist in determining whether you are tax resident or not. Some of these are as follows:

1. An intention to ordinarily reside in SA (most important consideration);
2. Your most fixed and settled place of residence;
3. Where you stay most often and your habits;
4. Your place of business and personal interests; and
5. Employment and economic factors.

In other words, if you leave SA with the intention of moving permanently to another country and subsequently settle in that country, it is likely that you have broken tax residency with SA.

If you have broken tax residency with SA, you don't need to worry about the amendment to the tax legislation.

It must be kept in mind that when you break your tax residency there is a deemed capital gains event (meaning that even if you do not sell assets, you are still liable for capital gains tax) on some assets held. Immovable property is not subject to this deemed event; the most common types of assets that affect individuals are shares held.

Proving you've broken tax residency

It is now important to determine how you can prove to Sars that you have broken tax residency so that the proposed amendments do not affect you.

Whether you're a tax resident in SA primarily depends on your state of mind, which can be difficult to prove. This is where Sars' factors become important.

If you're able to show Sars that your new home and economic and personal ties (among others) are in the new country, you should be able to prove you have broken tax residency.

You can also submit a tax return to Sars indicating you have broken residency - this is an option on the first page of your tax return. In addition, there are documents signed between countries called double taxation agreements (DTA). These give taxing rights to the signatory countries to the document. For example, SA has signed a DTA with the UK. If you're a resident of the UK in terms of the provisions in the DTA, you can't be a tax resident in SA.

If you’re unsure about your tax residency status, you should speak to a qualified tax advisor. This will ensure all your tax affairs are in order and that you are compliant before the new law is implemented next year.

Formal/financial emigration 

The concept of formal/financial emigration is separate from breaking tax residency. It is an exchange control concept and is dealt with by the South African Reserve Bank.

You may wish to formally emigrate, but don't have to. This involves an application to the bank and will result in all your South African funds being transferred into an 'emigrant's capital account'. Only the bank that has opened the account can deal with the funds.

However, if you've left the country it is not necessary for you to formally emigrate. It has no effect on your tax residency, although it can also be used as an indicator to Sars that you've broken tax residency.

There are a couple of instances where you must formally emigrate:

1. If you have a retirement annuity in SA that you wish to liquidate (unless you're already 55 in which case you don't need to formally emigrate); and
2. If you have more than R10m you wish to take out of SA.

Your citizenship is not affected by formal emigration and you get to keep your South African passport.

Effect on South African assets

Breaking tax residency has no effect on your assets (besides from the deemed capital gains event). However, if you're earning income from these assets, you must declare it to Sars and may be subject to taxation depending on the amount earned and type of income.

When you formally emigrate all your SA assets will be transferred into an emigrant's capital account with your bank. For example, if you have cash in bank accounts, these accounts must be closed, and the money transferred to the emigrant's capital account. 

If you have a retirement annuity that is liquidated, the money must be paid into this account. You must get approval from your bank when dealing with these assets once they are in the emigrant's capital account.

You are still entitled to keep any immovable property that you own in SA, but the title deed must probably be marked that the property is now owned by a non-resident. If this property is subsequently sold, the proceeds must also be paid into the account. On a final note, if you are a South African citizen working abroad temporarily and don't break tax residency, any tax that is paid in the country where you are working should be set off against any tax that is owed in SA on this foreign income. 

If you would like to proceed with placing your emigration on record with SARB, we will be happy to assist you. In order for us to do an initial review and provide you with a quote for our service, please can you complete the attached Financial Emigration Questionnaire. There are 3 separate tabs on the spreadsheet to complete. The financial emigration process and repatriation of funds can be somewhat complex so it is really helpful to have as much information as possible when evaluating the best course of action to take."