Money being held by Argentine banks?

#1
I read on a blog (sorry don't have the source right now) that when people wire in money to a bank in Argentina that the banks freeze a LARGE CHUNK of the money for a very long time!
Is this really true? Can someone talk about the details and their experiences with this. Seems to me this could be a really big problem for expats.
www.RetireAway.com
Forum for Americans Retiring Abroad
 
#2
This is true. 30% of money brought in is retained by the government for a year unless it is used for the purchase of property.
 
#3
Thanks for the info. So it is not being held for purchase of property, thats the good news. Is there a dollar level where they start holding; for example if you wire in 5,000 USD are you OK, but not OK if you wire in 10,000 USD?
How are people dealing with this? (Loopholes?)
 
#4
You can bring up to $10,000 into the country without declaring it. I don't know how many times per year etc. I am not sure that the money can be wired but I know that you can bring it in cash when you travel. Can't you withdraw from an ATM?
 
#5
I was mainly talking about WIRING money into an Argentine bank. Is it true that for the retirement visa you need to transfer in money to qualify for the visa? If that is true, that is an awful catch 22. Yes, otherwise, of course, you could use ATMs. But anyway you cut it, it sounds restrictive. Is this a new thing?
 
#6
I am doing some checking on these matters. To be absolutely certain you should talk to an official at a casa de cambio or a bank. Since the economic crisis a few years ago many rules and restrictions have been imposed such as the 30% retention. You might also want to ask about asset taxes for permanent residents. Your best answers will come from people in the financial sector (reliable casas de cambio especially) who deal with foreigners.
 
#7
OK, the rules regarding money transfers:

The Argentine government withholds 30% of any money sent into Argentina for 1 year. This is to avoid currency speculation. The only exception to this rule is for the purchase of property. However, the amount transferred in cannot exceed the value of the property and the bank cannot release the funds until they have seen the purchase contract and until you sign it.

Any money sent into Argentina is converted into pesos and then if you want dollars, it is converted back. The problem is that non-residents cannot legally buy more than us$5000 per month. So when you buy a property, it's officially the seller that converts the money back into dollars.

A normal bank cannot and will not allow non-residents to transfer money into the country for the purchase of a property. You have to use a bank that is legally registered to perform this service. Most foreigners don't know this and are illegally bringing money into the country using 'exchange houses' or 'private banks'. There are only a couple of banks that are registered to do this. One of these is Banco Piano, on San Martin between Corrientes and Sarmiento (i think). it charges 2% including all fees and currency exchanges.

You can bring up to us$10,000 per trip into the country in cash.

If you want to bring in large sums of money for non-property related business (eg renovations) it's better to do so illegally. No one will ever find out as there's nothing the tax authorities can physically see. However, at some point the central bank is going to to start asking questions as to how all these foreigners bought expensive properties without any of the money going through them (and therefore stiffing them for money).

If you buy a property and then sell within a year, the government will withhold 30% until the year is finished.

The above are the rules for NON-residents. Once you get residency it all changes. If you're a rentista or pensionista who needs to prove their income per month then a normal bank will be able to help. You could also simply take the cash out of an ATM and keep the receipts as proof.

Once you have residency you can bring in and send out as much money as you want without the 30% withholding through a normal bank. The catch with this is that many banks require you to be a customer for 6 months before they allow you to make international transfers. It's best to open an account as soon as possible whether you have residency or not. You just need a CDI and proof of domicile. Banco Frances is the bank that is most receptive to non-residents.

I got this info from my friend matt at www.realba.blogspot.com who's been dealing with these issues for quite a while now. I don't think he'll be around much longer in buenos aires as it would appear he's heading to chile for business soon but i should think he'll be happy to help if he can with any questions you might have.

dtz
 
#8
That´s really useful information. There is one problem with permanent residence: you have to pay tax to the Argentine government on all of your assets everywhere in the world, not just in Argentina. You are also subject to very high taxes on pension income.
 
#9
You get 5 years grace when you get residency where you don't have to pay tax on your foreign assets. you are supposed to declare them at the start though. mind you, if you're silly enough to tell the argentine tax authorities that you hold assets overseas then you probably deserve to be handing over your cash. they have no way of finding out about them unless you tell them and no argentine or sensible expat ever declares all their assets. in fact, not many argentines bother paying the asset tax and nothing ever happens. i know an argentine accountant and a lawyer who think i'm crazy for paying it on my property here.