PROTECT YOUR FOREIGN INCOME FROM SOUTH AFRICAN TAX

The best way to protect your foreign sourced income is under a Double Taxation Agreement (“DTA”). DTAs are international treaties that South Africa has signed with other countries. South Africa has DTAs in place with numerous countries around the world. One of the main purposes of a DTA is to prevent double taxation. Stated differently, DTAs ensure that a taxpayer is not unfairly taxed in South Africa as well as in their host country, thus enabling taxpayers to claim relief from double taxation.

TALK TO THE EXPERTS

WHY CHOOSE US?

We pride ourselves on our expertise in assisting clients with their complex tax matters that span across borders. Our team will thoroughly assess your circumstances and consider the relevant local tax laws and DTA provisions that would apply to you. This will provide you with absolute clarity and peace of mind regarding your expatriate tax affairs.

Cessation Of Tax Residency

Reduced Dividend And Interest Withholding Tax Claims

Post-Emigration Retirement Fund Tax Refunds

Obtain South African And Foreign Tax Residency Certificates

Specialised DTA Relief Claims

WHAT IS A DOUBLE TAX AGREEMENT (DTA)?

A DTA ensures that you are not unfairly taxed by both South Africa and another country dealt with in any respective DTA. It thus provides a defence to double taxation and sets out various requirements you must satisfy to understand if you are classified as a tax resident. This classification as a tax resident, in terms of the DTA, will impose an obligation on you to pay certain types of taxes on income received.

HOW TO PROTECT YOUR FOREIGN INCOME USING DTA

Where you have international economic interests, your income may potentially be subject to tax both in South Africa as well as in the foreign country, resulting in double taxation. A common misconception we have observed among South African expats is that they believe they are “automatically tax-exempt” just because there is a DTA in place between the two countries.

This is completely incorrect as there are various factors that need to be considered, and objectively proven. You are still required by law to file a tax return and claim relief from double tax under the DTA. Depending on whether or not a taxpayer is classified as a tax resident under the DTA, this will determine where (and how) the taxpayer must pay tax on income received.

To correctly apply for DTA relief on your foreign-sourced income, you will need to consider which country will actually have a right to tax your income. This is achieved through a measured approach, known as the tie-breaker test and paired with careful evaluation of the DTA provisions concerned.

WHO SHOULD APPLY FOR DTA RELIEF?

A DTA becomes relevant if a taxpayer is earning South African sourced income as well as foreign-sourced income, or if the taxpayer is a tax resident of South Africa (but does not receive South African sourced income) and is earning foreign-sourced income. A situation of this nature often gives rise to a grey area as to where a person can or should be taxed, especially considering that a South African tax resident is subject to tax in South Africa on worldwide income and assets.

Thus, many South Africans living and working abroad may need to consider what their tax treatment legally should be when taking into account the DTA between South Africa and their host country (the country they are now living and possibly working in).

There is a possibility that a taxpayer may be required to pay tax on their foreign income in South Africa and the use of a DTA may be applied to ensure that this does not happen.

TESTIMONIALS

I have used Tax Consulting South Africa for many years and have always found them to be very professional and helpful.

I have made use of their services for my SARS tax submissions, as well as their legal services for my DTA ( Double Taxation Agreement) opinion and support while working abroad to legally avoid double taxation.

Neil Dixon

Would highly recommend a consultation with Delano, he is extremely knowledgable and keeps it nice and simple in a very complex subject matter. Tax efficiency is important and Delano gets that and has a great countenance and incisive mind to help you navigate the options. Do yourself a favour and get the information you need to make decisions on expat tax, including financial immigration, double taxation and s10 exemptions – Delano and Tax Consulting are a great source of advice.

Brendon Fourie

The simple and succinct explanations, together with the in-depth knowledge shared on the DTA and FE routes are highly commendable. Many thanks, Delano and for conducting yourself in the virtual meeting respectfully and professionally. The pleasure was all mine…thank you.

Anisa Vahed

We went to a presentation of Tax Consulting SA in Riyadh in 2020. As an expat, it is a daunting task to relocate to a Middle Eastern country and to do the right thing tax wise, especially with regards to the legal requirements and compliance with SARS. Also, there are so many companies and people who advertise their services, especially in Riyadh & Dubai. We decided way back then to trust Tax Consulting and follow their advise and direction. The whole team, from first contact in Riyadh, to every tax submission since then has been super professional and they are true experts in their field. We especially want to thank Thomas who deals with the double tax agreements between Saudi & South Africa and then also from 2021 when we relocated to Dubai, again dealt with our case. Tax matters are super complex in nature and I would highly recommend using Tax Consulting SA for anything tax related if you are a South African expat living somewhere else in the world.

Karien Penderis

Emigrating can be an overwhelming experience with a lot of complications to deal with, particularly from a tax perspective. But Tax Consulting South Africa has been brilliant, setting our minds at ease and ensuring that our affairs are attended to with utmost care and professionalism.

Michael Appel

Delano was attentive to my situation, provided excellent situational analysis advice leading to a long term view plan. He left me feeling confident that my tax matters are on track and in competent hands @Tax Consulting SA.

Belinda Cowden

TAKE THE FIRST STEP TO PROTECT YOUR FOREIGN INCOME – SPEAK TO ONE OF OUR EXPERTS TODAY

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