Wealth should not be confined to a single jurisdiction. In a globalised world, should HNWIs hold wealth in ZAR, USD—or a diversified basket of currencies?
Traditionally, most advisers agree on four pillars of sound investing. William Bernstein’s classic framework—The Four Pillars of Investing—includes:
South Africans often link these pillars with the discipline and global reach of golf legend Gary Player. However, the increasing impact of geopolitical changes—such as the post-Trump era uncertainty in the US—suggests a potential fifth pillar: Political Risk.
In South African financial advice circles, four core principles—echoing the pillars—are commonly promoted:
The globalised HNWI cannot afford to be jurisdiction-bound. Spreading investments across countries and currencies reduces risk and seizes global opportunities. In this sense, the "fifth pillar" (political risk) becomes the first consideration.
Balancing risk and potential returns is vital. How conservative should one be? Do crypto assets and digital wallets have a place, or should one stick to the tried and tested?
Sound allocation across equities, bonds, cash, property—and perhaps digital assets—is essential for long-term growth and security.
Effective structures ensure minimal tax leakage and enable smooth wealth transfer. But how do we move assets out of trading entities while retaining control? Could family trusts, asset protection trusts, or even foundations be the answer?
To trust, or not to trust? With increasing global transparency and OECD-led scrutiny of trusts, are they still viable tools for succession planning—or simply misunderstood?
South African Complexity: Exchange Control (Excon) Restrictions
This remains a unique hurdle for South African HNWIs and must be factored into all international planning.
How do HNWIs shift from wealth creation to legacy building? Is it better to hand over cash-generating operations, or share wealth in more controlled ways?
Ongoing reform and transparency mean proactive, agile structures are critical.
Tax residency, nomadism, sibling rivalry, and complex family trees raise governance questions.
International growth brings diversification—but also compliance complexity and operational risk. How should this be navigated?
Is it more important to choose the right structure—or to prioritise tax efficiency within the structure that fits?
Do traditional models still apply? Or has digital disruption reshaped how we define investment “reward”?
Advisers must understand the life phase of both the individual and their broader family context—be it creation or preservation.
South African rules on wealth origin still apply, but they no longer dominate the strategy. The game is global.
Cross-border families require cross-border thinking—disclosure, planning, and alignment with global standards.
No single adviser can meet all the needs of an HNWI family. Collaboration is key to ensuring seamless wealth transitions and strategic growth.
CA(SA) TEP MTP(SA), Cross-Border and Tax Specialist
Hugo is an experienced trainer, lecturer and "go-to" industry specialist. It comes as no surprise that SARS appointed him to lecture on capital gains tax and worldwide taxation based on residency. In the last six years, he has presented at least once a quarter, for anyone of the many professional bodies he belongs to. Based in Cape Town, he is proudly South African yet holds a United Emirates Residency permit, because of his UAE registered practice aimed at expats. Hugo's client base is global, includes intermediary firms, local and international financial institutions and often the powers to be at the professional regulatory bodies he belongs to.
Mathys is an skillful attorney with both local and international legal academic knowledge. He was admitted as an attorney in 2014, marking the beginning of his successful career in the legal field. His expertise covers cross-border legal matters, exchange control, international money transfers and fiduciary services. Mathys provides top-notch legal services to individuals and businesses navigating the challenges of cross-border transactions.
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