Non Profit:

Permit and visa options for when your NGO is set up There are 3 basic options for the hiring of staff for an NGO:

1. Intra company transfer – this can only be achieved if when Setting up an NGO in South Africa it is structured correctly. An intra company transfer can only be done where there is a clear connection between the parent company based abroad and the NGO here in South Africa. The clearest example of this is that the ownership of the South African NGO is the parent company.
2. Volunteers visa – this is a visa that is for those foreign individuals who will be employed but for no remuneration.
3. General work visa – where the position has been advertised in South Africa and no suitable applicant has been found, requiring the employer (NGO in this case) to widen the search to foreign staff. _ Important to note_ Where the foreign employee is also a shareholder in the business, the shareholding must be minimal otherwise none of the above visa can be applied for.

For Profit:

The different visa’s for starting a business as a foreigner in South Africa

In order to be able to set up, invest into and work within a business in South Africa as an immigrant there are two types of visa you can apply for: Business visa – Traditionally, for anyone starting a business as a foreigner in South Africa this category has been the most recommended. Independent Financial Permit – A very underused permit category that allows for the holder to commence a business, but also offers a host of other benefits over the business visa route.

Who can apply?

Business visa are for those individuals seeking to invest in a business, or an existing start up, and who will be working within the business. The Independent Financial skills permit is a permit that is not restricted to a certain economic activity. As such it allows the holder total freedom to invest into a business, whether they will be working in it or not. There is also no obligation to invest, or start a business. In short the holder of the Independent permit is free to make their own decision as to whether they run a business, work or even retire.

Must there be local ownership?

No, a business can be owned and run with 100% foreign ownership. However for those with a local partner this is also fine. This applies to both the business visa and independent financially independent.

Can I buy into or outright an existing business?

Yes, whichever permit or visa category you select you can do either or indeed set up one from scratch.

Is there a minimum shareholding a foreigner must own?

As a business visa holder you will need to typically own in excess of 25% of the business. A Financially Independent permit holder has no restrictions.

Is there a minimum amount of investment required?

For business visa holders you need to invest ZAR 5 million into the business unless you qualify for a waiver. You can read more about the minimum investment amount here. There is no requirement for the holder of the Financially Independent permit to invest any set amount into as business, they are free to invest as little or as much as they desire. Note however, to successfully apply for a Financially Independent permit, you need to prove a net worth of the equivalent of ZAR12,000,000 (12 million) but these funds do not need to be brought into South Africa.

Can my partner or children work in the business?

Partners of the business visa holder can work in the business but not for remuneration. Children would not be able to work in the business unless a work visa was granted in their own right. If you have children still in education years a study visa would be required. Partners of Independent Financial permit holders will need to secure residency in their own right which would involve a spousal or life partner visa application. Dependent children would require a study visa.

Must I employ South Africans?

There is a requirement that employees are at least 60% South Africans (citizens or permanent residency holders). These must be employed on a permanent basis in the business if you hold a business visa. There are no such requirements for the Independent Financial permit holder.

Can I apply for permanent residency?

Starting a business as a foreigner in South Africa, via the business visa route, would first mean obtaining temporary residency. Once in receipt of this, permanent residency can be applied for. Independent Financial permit applicants may only apply for permanent residency. This of course has its attractions but the disadvantage can be that permanent residency takes longer for the Department to process.

What sort of company must I set up?

Typically a Pty Ltd would be the appropriate company structure and you can read more about the various business structures here.

I am in a permanent relationship / married to a South African – do I need a business visa?

Neither a business visa, not an Independent Financial Permit are required if you have a South African partner. Starting a business as a foreigner in South Africa with a South African partner requires you to have either a spousal visa or life partner visa which you can then endorse to set up and run a business.

If I am not working in the business, just investing, do I need a business visa?

Business visa’s are designed for the holder to work in the business. Foreign investors do not require a business visa. Any foreigner may own a business with no restriction. However should they intend to work within the business or come to live in South Africa a visa would be required.

Sources

• Starting a Business as a foreigner in South Africa
• Setting up an NGO in South Africa