Taxation for South African Expats

[pilotjan]

Have anybody heard that SA government is imposing 42%Tax on revenue earned abroad?

[Antman]

As I understand it it's only if you get sent abroad by a company in SA on contract for that company, so it sould not effect any pilots except those contracted out by SAA

[The Guvnor]

You are right - the SARS is now using nationality based taxes rather than source based (as it used to be). This means that SA citizens get taxed wherever in the world they are living and/or working - REGARDLESS OF RESIDENCE. The only other countries that I know of that have this crazy ruling are the United States and the Philippines.

However, with double taxation agreements, this only affects you if you are living and/or working in a country that does not have a taxation agreement with the RSA. You can get a list of ontracting countries from the SARS. Of course, it means that if you are in a country where they take say 30%, you still owe the SARS 12%.

The penalties for evading SA taxes are draconian - huge fines and mega jail time, as well as seizure of assets.

The only way around this is to shed SA citizenship.

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:) Happiness is a warm L1011 :)

[Capt Blu]

Its not nationality but Residency based Tax and at the moment its mainly for off-shore companies taking dividends back into SA. This exists in all first world countries - not that SA is first world !!

[The Guvnor]

Check with SARS - it is nationality. I have verified this though the SA High Commission in London.

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:) Happiness is a warm L1011 :)

[tired]

Nope, Guv, it's residency not nationality. My accountant says so and I've also got the original of the Budget speech in front of me. (Sad git that I am!!) Basically this means that if you're not resident for tax purposes in SA, then SARS has no interest in you. This means that guys who are living and paying tax in another country (ie are regarded as resident for tax purposes by the tax authority in that country) have no obligations to SARS on any money earned outside SA - though they still have to pay tax to SARS on money left in SA (eg rent from a house that has been let out etc.) I'm not sure what the status is of guys who are on tax free contracts - I suspect they may have quite a bit of arguing to do!
Guv, as for the SA High Commission in London - no disrespect to the guys andd gals there, but they're diplomats not financial people and they haven't got a clue. I suspect they're also quite sore about all this because it means their nice tax-free lives have just come to an end.
Hope this helps all who are affected.

[Capt Blu]

However be warned as an expat out of SA you MUST submit zero tax returns.

[skyrocket]

Seems to be lots of confusion on this issue, Would be nice to know exactly what is going on.

[skyrocket]

I think Tired is right on this, Good Luck guys,,