SSIS - Flat file always ANSI never UTF-8 encoded
In Source -> Advance Editor -> Component Properties -> Set Default Code Page to 65001 AlwaysUseDefaultCodePage to True
Then Source->Advance Editor -> Input And OutPut Properties Check Each Column in External Columns and OutPut Columns and set CodePage to 65001 wherever possible.
That's it.
By the way Excel can not define data inside the file to be UTF - 8. Excel is just a file handler. You can create csv files using notepad also. as long as you fill the csv file with UTF-8 you should be fine.
Adding explanation to the answers ...
setting the CodePage to 65001 (but do NOT check the Unicode checkbox on the file source), should generate a UTF-8 file. (yes, the data types internally also should be nvarchar, etc).
But the file that is produced from SSIS does not have a BOM header (Byte Order Marker), so some programs will assume it is still ASCII, not UTF-8. I've seen this confirmed by MS employees on MSDN, as well as confirmed by testing.
The file append solution is a way around this - by creating a blank file WITH the proper BOM, and then appending data from SSIS, the BOM header remains in place. If you tell SSIS to overwrite the file, it also loses the BOM.
Thanks for the hints here, it helped me figure out the above detail.