For immigrants moving to South Africa there is a number of opportunities and threats that have to be dealt with. Often people are simply unaware of the issues or put off seeking professional advice by the professional fees that may be involved.
We have built an industry leading Tax Health Check (details below) that has been specifically designed with the immigrant in mind, important support and help that you need when immigrating and at a low fixed cost.
Tax Health Check Details
Only two things in life are certain: Death and the Taxes
We would like to assist with the second certainty in life!
Relocation to a new country involves a lot of changes, with your tax status being one of the most important things that will be different from before.
Most clients will be regarded as a non- resident for tax purposes in their country of origin after relocation and will become a tax resident in South Africa.
There are a number of questions that you need to now be clear on, some of which are:
- Where do you now have to hand your tax return in?
- Where do you declare your income?
- What income do you need to declare?
- Are there any tax advantages for you due to the relocation?
- Is there anything that you have to especially be careful of?
You will now have to meet two revenue services’ obligations to be compliant with the laws in two countries.
South Africa
South Africa has a residence based taxation system which means, residents are- subject to certain exclusions- taxed on their worldwide income, irrespective of where their income was earned.
South Africa recently changed their tax laws, and the South African Revenue Service (SARS) was completely transformed in the year 2000. It is now one of the most modern, efficient, effective and well organised Revenue Services in the world. SARS is not a “third world country like” department of the government, but a government agency that should be treated with a lot of respect.
South Africa has agreements in place with over 80 countries to prevent double taxation of income accruing to a South African tax payer from a foreign source or of income accruing to a foreign tax payer from a South African source.
Since tax is such a complicated issue, especially when two revenue services are involved, we believe that it is most important for our clients to get all information they need to be compliant with the revenue services right from the start.
The Tax Health Check
We experience that the best starting point to clarify our client’s tax status is our Tax Health Check.
The Tax Health Check was developed to answer all questions clients may have and provides a basis from which we can then decide if further advice is necessary.
The Tax Health Check describes in detail and plain English the new tax situation you are facing after your relocation. It looks at your specific circumstances and provides tailored advice.
The Tax Health Check describes:
- the legal consequences of the double tax treaty
- in which country you will be seen as a tax resident
- what forms you will have to hand in to be seen as a tax resident
- what needs to be done to be seen as a non resident in the other country
- in which country you will pay tax for all kinds of income
- the changes in your capital gains tax status
- the changes in your inheritance tax status
- where you will have to hand a tax return in
- if you can keep contributing to your existing pension
- if you can keep contributing to the social security system of your home country
- your status for exchange control purposes in South Africa
- the basics of the South African tax system
- the advantages and disadvantages from a tax point of view of your relocation
The Procedure
The Tax Health Check works in 3 steps:
- We will send you a fact finding questionnaire. Your answers to our questions will give us an overview over your specific tax situation.
- We create a report, tailored to your personal situation which will provide you with all necessary information to establish and understand your new tax situation.
- All necessary documents will be posted to the different Revenue Services and other authorities to establish your new tax status correctly right from the start.
