Can I distribute capital from a trust to a non-resident when the non-resident has a block account and the founder passed away?
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
This is not a tax related issue and is best addressed to an authorised dealer or the SA Reserve Bank as you seem to have done. We accept that the trust is a tax resident of the RSA.
The Currency and Exchanges guidelines for individuals makes no reference to ‘blocked funds’ and one would have to determine that from the original Reserve Bank instruction.
The guide deals with capital distributions, but only in respect of capital distributions from local testamentary trusts due to non-residents. It may be remitted abroad, provided that the trustees resolution confirming the capital distribution and the Last Will and Testament confirming that the beneficiary is entitled to such capital distribution are available. It then only deals with income in respect of other trusts.