The Retirement Visa is covered in Section 20 of the Immigration Act. The primary requirement is that the applicant must have a sufficiently large monthly income to demonstrate that they can live comfortably in South Africa. The income that an applicant is required to show is presently set at R 37 000 per month. An applicant can illustrate this amount in two possible ways.

Firstly, the applicant can show that they have the right to a pension or an irrevocable annuity or retirement account in the amount of at least R 37 000 per month for the rest of their life. This is quite straight forward and doesn't require further elaboration.

The second way that a person can illustrate the amount is to show that they have a "minimum prescribed net worth". The "minimum prescribed net worth" is described in the Regulations to the Immigration Act as a "combination of assets realising" R 37 000 per month. This description has caused a fair amount of confusion and difference in interpretation.

The following interpretation is definitely correct and can be used. All income that is derived from any assets that belong to the applicant can be used. Accordingly, if the applicant has the following assets: real estate from which he derives rental income, a share portfolio from which he derives dividend income, a bank account from which he receives interest income or any asset/s from which an income is derived can be used in the calculation of the R 37 000 per month.

The following interpretation is probably incorrect and should not be used. That the applicant has an amount in cash that is equal to R 37 000 multiplied by the number of months that the applicant intends to reside in South Africa. In other words if the applicant intends to reside in South Africa for 48 months then they would need R 1 776 000 (48 months x R 37) 000 in cash.

The confusion with regards to the above interpretations has come about as a result of certain South African Embassies issuing Retirement Visas based on a lump sum amount while others do not.