A WORD OF CAUTION

The choice of offshore funds is vast and unless you are familiar with the regulation in the country in which the fund is registered and the track record of the manager, or you are being advised by someone who is, you are probably better off using a randdenomined global fund or an FSB-registered offshore fund.

If you invest in an offshore fund, FSB-registered or not, you need to have foreign currency in a foreign-currency bank account. You can invest up to R1 million a year into an offshore foreign-currency fund without getting tax clearance, but if you want to invest more, you will need a certificate from the South African Revenue Service stating that your tax affairs are in order.

If you invest in a fund domiciled outside of South Africa, you will have an offshore estate and may require an offshore will and executor for this estate. If you invest in an offshore endowment through a local company’s offshore branch, you can avoid some of these problems, but these products add an additional layer of costs.