To qualify for the Financially Independent Permit (FIP) – the number one way for high net worth and business people to obtain permanent residency in South Africa and have security over their long term investments, an applicant needs to be a person of high net worth and show a minimum of R12 million of their net worth assets.
What is high net worth?
High net worth equates to the amount of net worth an applicant can prove against their name. This is calculated by subtracting the applicant’s liabilities (debts) from his or her assets.
The qualifying amount to be proved for the FIP is R12, 000, 000 (12 million rand). There is no requirement to invest these funds in South Africa and they may remain in any country of your choice.
What assets qualify in the calculation of a person’s net worth?
A question often arises as to what constitutes one’s “assets” to be eligible for the FIP.
Property, financial investments, bank statements, portfolios, etc. may be considered as one’s assets for purposes of qualifying for this permit. In addition, there is no requirement for the money and or assets to be in South Africa or brought to South Africa. It is completely acceptable for the assets or investments to originate from abroad and remain there even after being issued with the permit.
Assets can be the following items that are owned by the applicant, that are worth a substantial amount of money:
- Immovable property such as residential property, office property or pieces of land
- Household property
- Movable property such as motor vehicles, valuable paintings, or jewellery
- Investments such as shares, growth investments, or fixed interest
- Cash and bank balances
How do I prove the above assets?
Documentary evidence will need to be provided with the application for the FIP in the form of title deeds to immovable property, share certificates for investments or bank statements for actual cash in bank accounts.
The applicant will also provide a statement of net-worth of his or her assets confirming that:
- The statement provided is a complete list of his or her assets and liabilities
- All assets listed in the statement are owned by the applicant with no encumbrances
- The values listed against each asset in the statement are as accurate as possible and to the best knowledge of the applicant
- The assets indeed exist
- The applicant has no liabilities or if they do have liabilites, these are correctly stated
- They obtained a statement of assets and liabilities from the applicant
- They received and inspected all the documents in relation to the assets and liabilities of the applicant, including proof of ownership and purchase of properties, as well as confirmation of investments
- They obtained written confirmation from the applicant confirming completeness, existence, valuation and accuracy of the listed assets and liabilities
- Reviewed all documents received from the applicant and noted no liabilities
Can I dispose of my assets whilst my application is still in process
Although one can dispose of assets in their name, we would not advise you to do so whilst your application is still in process. The Home Affairs Department has the discretion to request for any additional information or documentation during the processing of the application. Therefore, to avoid instances where, if you dispose of any of your assets whilst the application is still in process, thereby affecting your net-worth, it is advisable not to dispose of any assets declared in the FIP application until such time that the application is finalised and the permit issued.
Do I need to prove the R12 million again before the application is finalised?
There is no requirement to prove the R12 million again before the application is finalised or permit issued. However, Home Affairs has the prerogative to request for any additional information at any stage before finalisation of the application, therefore it is extremely important that whatever assets that are used to prove the R12 million net worth are not disposed of during the application process so that should Home Affairs request for proof, you are able to do so with no difficulties.
Proving that one can meet the R12 million is normally easily achievable if all assets are properly documented and in the name of the applicant. However, to have one’s assets properly valuated and to ensure that the figures are as accurate as possible requires valuation by a certified Chartered Accountant. Part of our service offering is to provide guidance to our clients to ensure that they obtain detailed and substantial valuations of their assets from recognised Chartered Accountants to avoid any queries from the Department of Home Affairs and ensure positive outcomes of their applications.
You may contact us today for an obligation free assessment to see if you qualify for this permit by completing the assessment form on the link below or contact us via WhatsApp on +27 73 554 6567
