Last Updated on 28/01/2025 by Carl-Peter Lehmann
As South African expats in the UAE, many have thrived in a low-tax environment and enjoyed financial growth beyond what may have been possible back home. But with the thought of returning to South Africa comes a range of questions and financial concerns. Understanding the financial landscape, from tax implications to estate planning complexities, is essential to ensure a smooth transition back to South Africa and protect the wealth you’ve built abroad.
In this guide, we’ll dive into the most common financial and lifestyle concerns faced by wealthier South African expats planning a return, explore strategies to ease the transition, and consider the residency tests, global family dynamics, and unique challenges of holding assets in the UAE.

Understanding South Africa’s Tax Residency Rules: Physical Presence and Ordinarily Resident Tests
One of the biggest financial considerations for returning expats is how South Africa’s tax residency rules will impact their foreign earnings and investments. In recent years, South Africa has introduced an “expat tax,” applying to South African tax residents with foreign income exceeding R1.25 million per year. Whether you’re a tax resident depends on residency tests that determine whether you’re liable for tax on your global income.
Tax Residency Tests
1. Physical Presence Test: This objective test measures the number of days you’ve spent in South Africa within a five-year period:
- 91 days in South Africa in each of the current and preceding five years, and
- A cumulative 915 days over the last five years.
If you meet these criteria, you’ll likely be classified as a South African tax resident, subjecting your worldwide income to South African taxes.
2. Ordinarily Resident (Subjective) Test: This test looks at your intent and ties to South Africa. Where do you return after your wanderings? If South Africa remains your “true home” where you return between stays abroad, SARS may classify you as “ordinarily resident” and a tax resident, even if you do not meet the physical presence test.
For expats who travel frequently or maintain homes around the world, you may consider a “global citizen” approach, staying in South Africa for just part of the year and maintaining tax residence elsewhere. However, given the subjective nature of this test, this strategy requires careful planning and proof of intent to avoid unintended tax liabilities.
Navigating Residency Complexity as a Global Citizen
For expats planning to spend only a few months in South Africa each year, clear documentation and consistent ties elsewhere (e.g., another tax residency) are essential. Establishing primary residence in a lower-tax jurisdiction can help, but it’s critical to monitor the number of days spent in South Africa and consult a tax advisor to avoid inadvertently becoming a tax resident.
Balancing Offshore and Local Investments
Many expats have built substantial investment portfolios offshore, often benefiting from tax advantages and broader market access. However, returning to South Africa involves decisions on whether to retain or repatriate these assets.
Key Considerations for Investment Rebalancing
• Currency Exposure: With the volatility of the South African Rand, keeping some assets in stable foreign currencies can act as a hedge.
• Local Market Opportunities: South Africa’s equity markets and property investments offer opportunities but also come with risks. Balancing a mix of local and offshore investments can provide flexibility and security.
• Exit Strategy for UAE Investments: Those holding property in the UAE may consider either liquidating or retaining these investments. Consulting a tax advisor to evaluate potential capital gains taxes or tax-efficient ways to repatriate funds is essential.
Henceforward can work with you to assess the optimal mix of local and foreign assets to align with your future lifestyle needs and tax obligations.
Further Reading: Our comprehensive guide to offshore investing and some of the best offshore investments available currently
Estate Planning Amidst Cross-Border Challenges and Sharia Law in the UAE
Managing assets in multiple countries poses complex estate planning challenges. In the UAE, for instance, Sharia law can impact asset inheritance, regardless of nationality.
Sharia Law and Asset Ownership in the UAE
For South African expats in the UAE, estate planning is essential to avoid unintended consequences of Sharia law. Without specific measures, assets in the UAE may be subject to Islamic inheritance laws, which distribute assets according to fixed shares, often different from a traditional South African will.
Possible Solutions:
• Setting Up a Will in the UAE: A will registered in the UAE, with clauses aligned to your South African will, can help protect your assets from Sharia law, ensuring they are distributed according to your wishes.
• Use of Foreign Trusts: For wealthier expats, a foreign trust can safeguard assets against automatic distribution. By holding UAE assets in a trust, you control the distribution and provide for beneficiaries under South African law or international wills.
Further Reading: Using discretionary or family trusts to secure your legacy and transfer wealth effectively
Cross-Border Estate Planning for Global Families
For expats with children living worldwide, effective estate planning becomes even more critical. Suppose your children reside in tax-heavy countries like Australia, where inheritance laws and taxes can be stringent. In that case, your estate plan must account for these cross-border complexities to avoid hefty taxes and distribution issues.
Challenges for Children Residing Abroad (e.g., Australia):
• Australian Inheritance Tax Implications: Australian residents may face taxes on inheritances from abroad. If your child resides in Australia, a trust or holding company might protect their inheritance from excessive tax liabilities.
• Coordination with Foreign Advisors: By working with advisors familiar with both South African and Australian laws, you can establish a plan that minimizes taxes and ensures smooth asset distribution to heirs in Australia and other countries.
A strategic estate plan, integrating international tax considerations, helps prevent tax erosion of your wealth and ensures your legacy aligns with your intentions.
Planning for Education and Family Needs
For families, education planning and lifestyle reintegration are key considerations. Many expats with children may need to adjust to the differences in South Africa’s education system, while others might plan for children to study abroad.
Financial Planning for Education
• Setting Up Foreign Education Funds: Maintaining some funds offshore in stable currencies can offer a practical way to save for potential overseas education costs.
• Investment Vehicles: Specialized investment accounts or trusts dedicated to education savings allow funds to grow tax-efficiently, providing a clear path to funding education wherever it may be.
Returning expats should explore both local and foreign educational savings plans to ensure they’re prepared to support their children’s aspirations without financial strain. Henceforward can advise on structuring these educational funds for maximum growth and security.
Healthcare and Medical Aid Adjustments
South African healthcare differs significantly from the UAE’s system. Many expats may have enjoyed employer-provided healthcare, while returning to South Africa often requires purchasing private medical aid and, in some cases, gap cover.
Healthcare Planning
• Private Medical Aid: South Africa offers private medical aid plans, which vary in coverage. Familiarizing yourself with options and ensuring coverage is in place before returning is essential.
• Gap Cover: Some expats find it useful to take out gap cover for unexpected medical expenses that are not fully covered by medical aid.
Henceforward can help you navigate healthcare options to ensure that your family is covered, and you avoid any gaps in service when transitioning back to South Africa.
How Henceforward Can Add Value for High-Net-Worth Expats Returning to South Africa
For South African expats with investable assets exceeding $2 million, Henceforward offers specialized services designed to preserve and grow wealth while navigating the complexities of cross-border financial management. Our team and advice partners have extensive experience in crafting tailored wealth strategies that align with both international regulations and South Africa’s unique financial landscape.
Here’s How Henceforward Can Support You:
1. Cross-Border Investment Strategies
With a high-net-worth portfolio, achieving a strategic blend of local and offshore investments is key. We assist clients in optimizing asset allocation, hedging against currency risks, and identifying tax-efficient structures, ensuring that both international and South African assets work in harmony to meet your financial goals.
2. Advanced Tax Planning
With South Africa’s intricate tax system, high-net-worth clients benefit from proactive tax planning to mitigate liabilities. Our specialist partners structure assets to minimize tax exposure, leveraging tools such as trusts, offshore investments, and tailored tax strategies to preserve your wealth across borders.
3. Estate and Legacy Planning
For clients with substantial wealth and global family ties, we add value in cross-border estate planning that aligns with multiple jurisdictions, protecting your assets and facilitating smooth wealth transfer to heirs. Our approach ensures your estate is structured to meet the legal and tax requirements in South Africa, the UAE, and beyond, providing peace of mind that your legacy will be honoured.
4. Foreign Trust and Asset Protection Solutions
For clients with significant assets in the UAE or other countries, establishing foreign trusts can be an effective solution to protect wealth from the uncertainties of inheritance laws, such as Sharia law in the UAE. We can guide you in creating trust structures that preserve control over asset distribution, providing security for you and your beneficiaries.
5. Tailored Financial Planning and Advisory Services
With extensive experience in serving high-net-worth individuals, Henceforward offers a comprehensive, bespoke approach to wealth management. Our services go beyond basic financial advice, helping you create a holistic plan that encompasses investment growth, risk management, and wealth preservation.
Partner with Henceforward for a Secure Financial Future
As you consider your return to South Africa or a global lifestyle that includes time in South Africa, partnering with an advisor who understands the nuances of cross-border wealth management is essential. If you have investable assets exceeding $2 million, Henceforward can provide the expertise, strategic insights, and international perspective to support your financial journey. Our goal is to help you achieve long-term financial security and peace of mind, no matter where life takes you.

Steven Hall
Steven is the founding partner and a director of Henceforward, bringing over 20 years of experience in wealth management and financial planning. As a Certified Financial Planner (CFP®), he is passionate about lifestyle financial planning and specializes in helping families navigate the complexities of cross-border financial planning. With deep expertise in offshore investments, tax-efficient wealth strategies, and estate planning, Steven is dedicated to guiding clients toward financial security and long-term prosperit