Having a Financially Independent Permit (FIP) is the best decision and business investment you could ever make. If you are a high net worth individual looking to make long term investments in South Africa, or borrow money in SA for your business ventures, investing in and gaining the FIP could be the smartest business decision you could make. We have seen enormous personal and financial benefits from most of our clients who have invested in the FIP.
WHAT IS A FINANCIALLY INDEPENDENT PERMIT (FIP)?
- A permanent permit which allows you to live in South Africa on a permanent basis
- Ideal for high net worth individuals of any age and nationality who wish to stay in South Africa for a prolonged period without working or studying.
HOW DO I QUALIFY FOR THIS PERMIT?
- You must be a high net worth individual
- A person with liquid financial assets.
- Net worth = amount which your assets exceed your liabilities.
- Net worth is the difference between what you own and what you owe.
- Minimum of ZAR12 million net-worth amount
- You must prove at least R12, 000, 000 (12 million rand) of your net-worth
- No requirement to bring it into South Africa.
- No tax on your accumulated wealth other than ongoing requirements in terms of income or capital tax. This will only happen once you have obtained the permanent residence permit and are now deemed a South African resident for tax purposes.
- R120 000 fee
- Payment of ZAR120,000 to the Department of Home Affairs before issuance of the permit.
- Therefore, no risk because this is only paid once application is approved
WHAT ARE THE FINANCIAL BENEFITS OF HAVING THIS PERMIT?
- More secure position financially, investments not tied down
- Added security in terms of your investments
- Less complex application process
- No need for temporary visas which require constant renewals, creating uncertainty for your stay in SA
- Flexibility – free to carry out desired activities in SA with no restrictions
Access to long-term finance for property purchases and other long-term investment plans
- Not having FIP means that if you want to stay in South Africa, you need to have a temporary residence visa.
- With a temporary visa, access to loans is very difficult and if the loan is granted, usually the duration of your temporary visa impacts the repayment period and results in high interest rates which can be a huge and an unnecessary financial burden on you. In some instances, before being granted the loan or finance, you are required to pay a huge deposit due to the fact that your temporary residence visa does not guarantee security of your stay in South Africa.
- There is no security of tenure for long-term investments and this can be a very precarious place to be.
Investments not tied down
- Does not require you to make any investment in SA, nor transfer any amount of funds to South Africa except the R120 000 payable to DHA once application is approved.
Great security for long-term investment plans
- FIP guarantees you permanent stay in South Africa
- PRP holders get ID book with ID number, therefore rights and duties of SA citizen (except right to vote)
- PRP gives you financial advantages that enable you to comfortably invest with a long-term horizon, acquire property in South Africa with low to zero deposit/equity compared to a temporary residence holder, making it financially viable for you.
Less complex process
- Less complex, a much more flexible and quicker route to obtain permanent residency in South Africa
- No TRV therefore no waste of time with constant renewals and re-obtaining documents each time you apply for an extension
Flexibility
- No obligation for you to physically reside in South Africa once you have the permit, but only come at least once every 3 years so as not to lose the right to PR status
- Once a PR holder, can carry out any activity in SA such as retire, start a business, work or even study
CAN I DO BUSINESS IN SA ON A FIP?
Yes, you can.
FIP can be a great alternative to the Business Visa if one qualifies for this permit and would like to operate a business in South Africa.
Advantages of the FIP over the Business Visa are:
- Direct residence status cutting through the red tape of a business visa
- Limited options with the Business Visa
- Easy access to long-term loans and security for investment options
CAN I RETIRE IN SA ON A FIP?
Yes, you can.
Two permit/visa options for prospective retirees in South Africa:
- Retired Persons Visa (temporary visa) followed by Permanent Residence Permit
- Financially Independent Permit
Advantages of the FIP over the Retired Person’s Visa/Permit:
- Current capital vs continuous future income
- No need to transfer any funds to South Africa
- Tax implications on income vs capital
HOW DO I APPLY FOR THE FIP?
You may apply for this permit at the South African Mission in your home country or at the local VFS Office in South Africa (if you have a valid temporary residence visa in South Africa)
HOW LONG DOES THE PROCESS TAKE?
As this is a permanent residence application, processing times are between 9 to 18 months.
HOW DO I PREPARE FOR MY APPLICATION?
- Do not procrastinate
- Ensure eligibility
- List all your sources of income
- Setup your goals
