Key takeaways
- Exchange control is run by the Financial Surveillance Department of the South African Reserve Bank (SARB), but you deal with a bank appointed as an "Authorised Dealer", which handles anything the SARB's manual permits.
- Non-residents may freely invest in South Africa if the deal is at arm's length, at a fair, market-related price, and paid for in an approved way, usually foreign currency brought in through a South African bank.
- Share certificates in an unlisted South African company bought with money from abroad are endorsed "non-resident". Keep the certificate and the bank's payment records: they are your evidence when money goes out.
- Dividends can be sent abroad in proportion to your shareholding, against proof of tax compliance from the South African Revenue Service (SARS), and sale proceeds "may be regarded as freely transferable", paid out through the bank once it has the evidence it needs and any tax withholding is dealt with.
- Loans need approval before the money moves, and borrowing in South Africa to buy shares, or in most cases property, is limited to one rand (R1; the rand, ZAR, is South Africa's currency) for every rand you bring in or own (SARB manual section I.1).
Who runs exchange control, and who you deal with
South Africa's currency is the rand (ZAR), written R. Its exchange control rests on the Currency and Exchanges Act of 1933 and the Exchange Control Regulations of 1961. It is run day to day by the Financial Surveillance Department (FinSurv) of the South African Reserve Bank (SARB), the central bank, under powers delegated by the Minister of Finance.
The SARB says all exchange control matters go through an Authorised Dealer or an Authorised Dealer with limited authority (an ADLA: bureaux de change and money-transfer services, which handle a narrower range of transactions). For an investment, use a bank that is an Authorised Dealer: it is Authorised Dealers that place the non-resident endorsement described below. Authorised Dealers are the South African offices of the banks listed in the SARB's Currency and Exchanges Manual for Authorised Dealers. They include the large South African banks and the South African branches of international banks such as Bank of China, Citibank and Standard Chartered. Your bank may process anything the Manual permits without referring it to FinSurv; anything else needs a formal application, which the bank submits.
Are you a non-resident?
A non-resident is a person or company whose normal place of residence, domicile or registration is outside the Common Monetary Area (CMA): South Africa, Lesotho, Namibia and eSwatini. A foreign national whose home is in London, Dubai, Nairobi or Shanghai is a non-resident; one whose home is in Windhoek is not. If you are South African and live abroad, you may still be a resident for exchange control purposes, so confirm your status with your bank first.
Exchange control sits alongside anti-money-laundering law, so expect your bank to ask who you are and where the money comes from.
Bringing the money in
The Manual's starting point is open: "Non-residents may freely invest in South Africa", provided documents show the deal is at arm's length (as between unconnected parties), at a fair, market-related price, and "financed in an approved manner". The approved ways to pay are:
- Foreign currency brought in through a South African bank and converted to rand, the usual route.
- Rand from a non-resident rand account in your name, the account a non-resident holds with an Authorised Dealer.
- Rand from a vostro account, the rand account a foreign bank keeps with a South African bank.
- Money borrowed in South Africa, within the limits under loans below.
Pay from an account in your own name, or your buying company's, and keep the bank's confirmation of every payment. If you buy a business through a South African company, how the money goes into that company, as share capital or as a loan, decides which rules apply, so settle the structure with your attorney and bank first.
The non-resident endorsement, and why it matters
When a non-resident buys shares in an unlisted South African company with foreign currency, or rand from a non-resident rand account, the bank must endorse the share certificate "non-resident" under its stamp and an authorised officer's signature. Any certificated shares in which a non-resident has an interest "of any nature whatsoever" must carry it, however they were acquired. Transfer secretaries, who keep a company's share register, may not register shares in a non-resident's name without endorsing them, and any transfer secretary or Authorised Dealer to whom the shares are presented must have them endorsed immediately, so a South African seller should make the endorsement part of the closing steps. The endorsement:
- Marks the shares as owned by a non-resident. The scheme exists to keep non-resident-owned shares apart from residents' shares; it does not by itself prove how you paid. Keep the endorsed certificate with the bank's confirmation of every inward payment: before a bank sends dividends abroad it must be sure the amount is legitimately due to a non-resident, and these records, alongside the SARS documents below, are the evidence you can offer.
- Ring-fences the shares. They are "bad delivery" to a South African resident until the endorsement is cancelled. You may sell to another non-resident and they stay endorsed.
- Controls the exit. Only an Authorised Bank (a bank branch FinSurv has authorised to cancel non-resident endorsements) can cancel it, and on a sale to a resident it does so against payment of the proceeds to it, for transfer abroad or a non-resident rand account, with an auditor's certificate of the value of unlisted shares.
If your shares were never endorsed, raise it with your bank early.
Taking dividends and other income home
Banks may transfer dividends, profits and income distributions to non-resident shareholders in proportion to their shareholding. First the bank must be sure the amount is due to you and local liabilities are provided for, and it needs proof from the South African Revenue Service (SARS), the tax authority: a "TCS AIT PIN" (a tax compliance status PIN for SARS's Approval of International Transfers process) if you are registered with SARS, or a Manual Letter of Compliance (International Transfer) if you are not. SARS says an unregistered non-resident cannot apply for a tax compliance status, which is what the letter is for.
Dividends tax
Dividends tax is 20% on dividends paid on or after 22 February 2017 (SARS: dividends tax), withheld by the paying company (or a regulated intermediary). A double tax agreement between South Africa and your country may reduce it: check the agreement on SARS's list of double taxation agreements. The company withholds at the reduced rate only if it has your declaration and undertaking before it pays. Otherwise it withholds the full 20%, and you then have three years from the date of payment to submit the forms and claim the difference back from whoever withheld it (SARS quick guide to dividends tax, paragraphs 6, 7 and 13.3).
Interest
Interest on a loan to the company can be sent abroad only if the bank is satisfied the loan and its interest rate were approved. Interest paid to a non-resident is also subject to a 15% withholding tax (since 1 March 2015), deducted by the company that pays it, unless an exemption applies or a tax treaty lowers it (SARS: withholding tax on interest; SARS, Taxation in South Africa 2026, section 5).
Selling up and taking the proceeds out
The Manual says the local sale proceeds of non-resident-owned assets in South Africa "may be regarded as freely transferable". You can send them abroad, or keep them in a non-resident rand account and invest them here again. The money moves through the bank, with paperwork: on a sale of your shares to a South African resident, an Authorised Bank cancels the endorsement only against payment of the proceeds to it, with an auditor's certificate of the value of unlisted shares, and any tax the buyer must withhold (see below) is deducted from the price first.
The fair-price test, and who carries it
The control that remains falls on the South African side. Because exchange controls on non-residents have been abolished, "the onus is on the South African buyer or seller of securities to prove that the transaction was concluded on an arm's length basis and at a fair and market related price". Banks must see evidence, such as an auditor's certificate for unlisted shares, and refer doubtful cases to FinSurv: a mispriced deal can export capital without the permission Regulation 10(1)(c) requires. An independent, documented view of value protects both sides: see how to value a business in South Africa and selling your business to a foreign buyer.
Tax is a separate question
South Africa taxes a non-resident's capital gains only on South African immovable property and on assets of a permanent establishment here. Shares count too if 80% or more of their value comes from South African immovable property and you hold, with connected persons, at least 20% of the company (SARS capital gains tax guide, chapter 4). Treaties can change this.
If you sell South African immovable property, or shares that meet that 80% and 20% test, for more than R2 million, the buyer must withhold 7.5% of the price (an individual seller), 10% (a company) or 15% (a trust) and pay it to SARS as an advance on your tax, under section 35A of the Income Tax Act (SARS guide IT-PP-02-G01; rates as at 30 September 2026 in SARS, Taxation in South Africa 2026, section 2.15). You can apply to SARS (form NR03) for a directive that less, or nothing, be withheld, so apply early. See selling property on auction.
Funding the purchase with a loan
A loan from abroad
If you, your group or a foreign bank will lend to a South African company, get approval before the money moves. The Manual says any loan account between a resident and a non-resident needs FinSurv's prior written approval, but it also lets the company's bank approve an inward foreign loan itself when the loan meets set criteria and is recorded on the SARB's Loan Reporting System; anything outside those criteria goes to FinSurv. The criteria include a term of at least one month, no fees paid upfront (fees of up to 5% of the principal may be paid once the loan has arrived), a market-related interest rate (for a loan from you or your group, the bank also needs senior management's confirmation that transfer pricing records are kept as SARS requires), and the principal brought in within 12 months. Repayments must follow the loan's terms. Capitalising interest, converting the loan into shares or regularising a loan made without approval all go to FinSurv.
Borrowing in South Africa
The Regulations prohibit lending to non-residents and to "affected persons" without an exemption, and the Manual gives banks that exemption within limits. An affected person is a company, trust or partnership operating in South Africa that is 75% or more owned or controlled by non-residents, so a company you own outright is one (SARB manual sections A.1 and I.1).
| Borrower | Purpose | Limit |
|---|---|---|
| Non-resident | Other genuine foreign direct investment (not buying shares or property) | No ratio, but secured, and within 100% of the funds you brought in |
| Non-resident | Financial transactions (which include buying listed or unlisted shares), or residential or commercial property | 1:1 (R1 borrowed for every R1 you bring in or own) |
| Affected person | Anything except financial transactions and residential property | None |
| Affected person | Financial transactions or residential property | 1:1 |
Buying the shares of a business counts as a financial transaction, so the 1:1 row applies even when your stake is large enough to be a direct investment (the Manual’s threshold is 10% or more). Any facility to a non-resident must be secured by a rand deposit or rand asset of at least equal value, and may not exceed 100% of the rand value of the funds you brought in (SARB manual section I.1). The exemptions are given to banks: if anyone else, including the seller, is to give you credit, such as paying the price over time, ask your attorney and bank whether approval is needed first.
When the foreign buyer is really South African
Some buyers that look foreign are South African residents investing back through an offshore company, which the Manual calls a loop structure. Residents with authorised foreign assets may do this, but the investment must be reported to an Authorised Dealer, a progress report goes to FinSurv each year, and an independent auditor's confirmation (or other suitable evidence) must show an arm's-length, fair price. A seller should ask early who ultimately owns the buyer.
The rules are being rewritten
On 17 April 2026, National Treasury published draft Capital Flow Management Regulations, 2026 for comment, with a joint statement by Treasury and the SARB. Once final, they will replace the 1961 Regulations. The statement says the aim is fewer transaction pre-approvals and more focus on reporting, and that Treasury and the SARB will consider the comments and revise the draft where necessary. As published, the draft still controls dealings in shares owned by non-residents (draft regulation 15), so do not assume the endorsement is about to disappear. On 5 October 2026, Treasury's website still showed only the draft, so the current rules apply, including the endorsement.
Practical steps for a foreign buyer
- Appoint a South African attorney, a tax adviser and a bank that is an Authorised Dealer. This guide is general information, not advice on your deal.
- Decide the structure, shares or a business bought through a South African company: see buying a business in South Africa as a foreigner and the due diligence checklist.
- Agree a price you can show is fair, with evidence of value.
- Get any loan approved before the money moves.
- Bring the money in through the bank and keep every inward payment confirmation.
- Have the share certificate endorsed and keep the original.
- Sort out SARS early: a TCS AIT PIN or Manual Letter of Compliance, and your treaty forms before the first dividend.
- If you will live and work here, see the business visa for investors, and tell your bank when you arrive. Foreign nationals living in South Africa (not visitors) declare in writing to an Authorised Dealer whether they hold foreign assets, and may then bank on a resident basis, but their interests in South African companies still count as non-resident for local borrowing. Keep proof of the capital you bring in: the bank may let you send it back abroad later if you can show how it was brought in.
Where Dynamic fits
Dynamic Business Sales, the Dynamic Auctioneers division that sells trading businesses as going concerns, sells by auction with a reserve or by private treaty. Every buyer signs a non-disclosure agreement before receiving the information pack, and in a private sale before learning the business's name, and shows proof of funds before seeing the books. On a public auction the business may be named in the catalogue. Our online auction room lets you open an account with a passport number if you are not a South African citizen: see how to register and bid online. Opening an account is not approval to bid: like every bidder, you upload your identity documents for FICA (anti-money-laundering) verification and register for each auction, and you can bid only once that registration is approved. Bids, deposits and fees on our auctions are in South African rand.
Exchange control runs through your bank, and on a share sale the South African seller must be able to show the price was fair, so agree with the seller and your bank how the money will reach South Africa before you bid or make an offer, not after. Start with our page for international buyers, browse the businesses for sale, or see how we sell businesses.