Emigration and international travel from South Africa have probably increased your chance of having friends or family who live on the other side of the globe. Fortunately, your digital devices can help you stay in touch. Whether it’s your best friend on a work visa in Europe, a sibling doing a stint as an au pair in the US, or your parents retiring in New Zealand, video calls and social media can keep you connected – technology has shrunk the distance between us and blurred borders.

Global online shopping means that you can celebrate birthdays and special occasions with gifts sent around the world, and digital banking makes it just as easy to send your loved ones money gifts across international borders. But what does South African tax law say about receiving gifts or money from abroad?

Tax rules on receiving gifts from abroad

Cash

When you receive a cash gift from a friend or relative living overseas, there generally isn’t any tax liability – but you still have to declare what you receive. When you submit your tax return (ITR12), you will see a section titled Amount considered non-taxable. You can declare your gifts in the field marked Donations.

The South African Revenue Service (SARS) has put this requirement in place to ensure that you comply with South African tax laws, by declaring all income you receive, whether taxable or not. Transparency and honesty on your tax return will help you avoid potential penalties.

Declare any money that you receive from abroad in your tax return. This can be anything from an inheritance or rental income, to money you get from your side hustle or, as stated above, any gifts you receive. When in doubt, it’s best to declare the amount received to SARS, because they can question the source of any cash flow.

Note, however, that although you may not have to pay tax on a cash gift classified as a donation, if the country from which the money is being sent applies a donations tax, the sender will have to pay this amount when they send you the money.

Non-cash gifts

When you receive gifts from overseas, SARS requires you to declare these items in your tax return too, under Donations. Some non-cash gifts may be subject to customs duties and import taxes. Any duties that you need to pay will be based on the type and value of the gift you’ve received.

When your gift arrives in South Africa, it will go through inspection at a customs warehouse, where customs officials will calculate the tax payable, if any, and then notify you of the amount due. You’ll be able to collect your package only once you’ve paid the required customs duty and taxes.

Any VAT and customs duty in this case are your responsibility as the receiver.

Receiving an international EFT payment

Nedbank provides a safe, secure way for you to receive international payments through the SWIFT network. This service is available to all South African residents, non-residents and businesses, provided that you have a Nedbank account.

For deposits into a Nedbank account, use our SWIFT code, ‘NEDSZAJJ’, your full name as it appears on your ID, and your account number to complete the transaction. There is no limit to the amount you can receive. However, the money must be accepted within 30 days, and it can be paid only into the account specified by the sender’s bank.

You can easily receive international payments via the Money app or Online Banking.

Money app
 

1. Log in to the Money app.

2. Swipe to the International banking dashboard.

3. Tap on International payments.

4. Tap Receive a payment.

5. Follow the prompts to complete the payment.

Online Banking
 

1. Log in to Online Banking.

2. Select Pay.

3. Select International payments.

4. Select Receive a payment.

5. Follow the prompts to complete the payment.