The past two years have been a journey into unchartered waters for all, and a particularly tense time as far as South African expatriates are concerned. For many expats, more and more questions have been left unanswered as this filing season, and the tax filing period draws to a close on 23 November.
Many South Africans work and live in Zambia because it is a favourable mining, construction, and agricultural African destination. Some of these South Africans have either temporarily or permanently made the move to Zambia without following the correct emigration procedures to mitigate their tax exposure in South Africa.
Post-Covid economic resurgence saw an increase in international work opportunities. With skills in hand, many South African professionals have become sought-after in other countries. As a result, their finances and subsequent taxation have come under scrutiny. However, along with the awareness of tax complications, another threat has emerged.
The lockdown in South Africa followed shortly after the introduction of the expat tax limitation in section 10(1)(o)(ii) of the Income Tax Act.
If a South African expatriate had to describe the year 2020 in one word, “uncertainty” would no doubt rank as one of the most appropriate.
Rotational Workers – The Victims of 01 March 2020 Expatriate Tax Having just returned from visiting South Africans in remote locations in the Democratic Republic of Congo, Zambia, Oman, Qatar, Saudi Arabia, UAE etc;
Following the most recent presidential address, it is clear that South Africa’s borders are going to remain closed for non-essential travel, at least for the time being.
Having just returned from visiting South Africans in remote locations in the Democratic Republic of Congo, Zambia, Oman, Qatar, Saudi Arabia and the UAE, one gains an appreciation for expatriates living in these locations.
South Africa Bleeding Skills Not surprisingly, there has been an outflow of South Africans in recent years for various reasons, a top reason being the punitive “expat tax” regime promulgated in December 2017, and effective 1 March 2020.
Amendments to the Income Tax Act will soon see all South Africans working outside the country’s borders contribute to the fiscus from 1 March 2020.