how long before we apply for British citizenship should we apply for a section 6 letter to hold dual citizenship?
you can apply for the exemption from SA at any time, now is as good a time as any.
What happens if we don't have a section 6 letter... will we lose our SA citizenship? How will SA know? Say for instance, we go back to SA, leave the Uk on our Uk passports and enter SA on our SA passports and leave on our SA passports again... how will immigration there know we obtained British citizenship?
The next time you apply for a SA passport, they will ask for proof that you either have the exemption, or that you haven't applied for UK citizenship.
If we 'lost' our citizenship and decide to move back to SA in 10 yearâ€™s time, can we just re-apply or is it more complicated?
You would have to apply to have your citizenship reinstated. This is a grey area, but why make it complicated when it is an easy process in the first place
And lastly, if we hold dual citizenship and we end up having investments here in the UK, can we be taxed on our earnings from a SA point of view?
Taxation doesn't depend on citizenship status, it applies to where you are deemed domociled. There is a dual taxation agreement between SA and the UK. It is different area that needs looking into at the time.