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Relocating your employees to South Africa
As being the most developed country on the African continent, South Africa offers lots of business opportunities for international companies to expand to Africa. Add to this the nice climate, beautiful beaches, impressing cities, friendly people and low costs for living and South Africa is the perfect destination for expats. However, arranging certain things is not as straightforward as in the more developed countries. In this article we give you the most important information to get started with relocating your employees to South Africa.
In general, South Africa is extremely welcome to foreigners to come working or studying in their country. Immigration processes can take time but, in most cases, a relocation is possible.
Employees that come to work in South Africa for a subsidiary or affiliated business of their current company, can apply for an intra-company transfer work visa. In contrast to a regular work visa, it is not very difficult to apply and get approved. For a normal work visa (when an expat wants to work for a South African company that is not a subsidiary of their current employer), there are more restrictions. An expat must already have found an employer, and that employer must prove that they did everything to hire a local employee but failed. For intra-company transfers, this requirement does not apply.
Both the current company of the employee and the subsidiary in South Africa need to hand in some documents with explanation of the tasks and goals of the intra-company transfer. The document of the company in South Africa must also contain information about the duration of the contract. This must be a minimum of six months.
An intra-company transfer visa has a maximum validity of four years. This cannot be extended or renewed. So, the maximum period of which an expat can work for the company in South Africa is four years.
The application process can take up to 3 to 4 weeks, but exceptions and delays are common.
What about the employee’s spouse and children?
Partners of the employee must apply for an accompanying visa and children for a study visa (in order to be able to go to school in South Africa).
Does your employee relocate with their family to South Africa? Make sure that they start school searching very soon. Places in private schools are limited so they need to be on time. Private schools are the most common for expats since public schools have a significant different level of education.
Home schooling is also becoming increasingly popular among expats. Private teachers are common in South Africa and do not cost the earth.
South Africa is a safe country. However, some poorer areas are more dangerous and have higher rates of criminality. These areas are not suitable for expats and their families. Security states and gated communities are therefore popular choices for expats. Since the costs of living in general (so also housing) are lower compared to western countries, expats can afford big and luxury houses with big gardens or private swimming pools. Apartments in a complex with shared facilities are also very common.
Given the weakness of the South African currency (Rand), expats for long term stays choose to buy a property rather than renting. Foreigners are free to purchase a property in South Africa with limited restrictions. The only condition is that the property must be endorsed as ‘non-resident’, even if you are living in the country full-time. Non-residents have to pay capital gains tax when selling the property.
Public transportation is properly not as extensive as expats are used to. Especially to the gated communities, public transport is not common. Most expats therefore own a car. The driving license from home is valid, as long as it is in English.
Other points of attention
Setting up bank accounts and utilities is quite complex. Make sure to arrange certain things in time, to avoid later problems or inconveniences.
For expats, it is common to arrange private healthcare. The private hospitals and clinics in South Africa belong to the best in the world and are very affordable for expats. However, facilities can be poor and therefore waiting lists can be long.
Costs of relocating employees to South Africa
In comparison to the most countries in Europe, The United States or Australia, South Africa is a cheap country for living. However, since moving to South Africa is rather complicated, the relocation can still cost a serious amount of money.
Applying for the intra-company work visa will cost the fixed price of $127. However, hiring an expert or lawyer to arrange this will add up to the costs.
Relocations from almost any country in the world to South Africa require air or sea movements. This is more expensive than shipment by road. Considering the average household effect of a family, moving to South Africa will cost at least $7.000. Of course, renting a furnished house will spare costs since furniture takes most of the space.
Some other factors do also influence the price of the movement. For example, Cape Town is easily accessible by boat because of their harbor. Johannesburg, at the other hand, is in the mainland and therefore harder to reach. Boat containers must be reloaded on trucks and therefore the move will become more expensive.
Make sure your employee starts the adventure as relaxed as possible by providing them packing services. On average, this will cost you $150 for a 20ft container of goods.
Better safe than sorry! A good insurance is essential for international moves. Normally, prices differ between 0.6% and 4% of the total value of the goods. An average three-bedroom house or apartment has a value of $50.000. insurance costs somewhere between $300 and $2000.
Cost of living
The costs of living in South Africa are far lower than European, American or Australian standards. So, if your employee is paid in a stronger currency, they will have more disposable income than back home.
Costs of living for a family of four (without housing) is estimated to be $2.000 per month. Two of the most popular areas for expats in Cape Town are Gardens and Vredehoek. The rental prices in these areas differ from $700 for a one-bedroom apartment to $1.400 for a three-room apartment. The rental price for a luxury villa in a gated community varies between $1.000 and $2.000.
Costs of living far lower than EU / America / Australian standards. If youre paid in a stronger currency – you have more disposable income than back home.
Find your company a professional relocator
A good start is half the work. Find yourself a professional relocation and international moving company to help you with everything related to the relocation. At Voerman International, we are happy to assist you with our move management and relocation management services.Back to overview