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Introduction to South African Income TaxPresented by:Graeme Saggers CA(SA)Nolands Advisory Services

Business Wednesday Tax & Currency

Introduction

• Who are we?• Types of tax in South Africa• Residence based system• Resident individuals• Resident companies• Non-resident individuals and companies• Main differences between South African and

French Income Tax


Who are we?• National firm with Head Office in Cape Town and 9

offices throughout South Africa• Offer services in• Audit• Forensics• Advisory• Tax

• Local and foreign client base• Affiliation to Geneva Group International


Type of Tax in South Africa• South African Revenue Services (SARS) – central

administration for all taxes• Direct taxes• Income Tax• Tax on Income• Tax on Capital Gains (CGT)

• Dividend Tax• Withholding taxes• Estate Duty

• Indirect taxes• Value-added Tax (VAT)• Transfer Duty• Customs and Excise Duty


Residence based system

• Residence vs Source based system• Gross Income definition• Residents taxable on worldwide earnings• Non-residents taxable on earnings from a source within

South Africa

• Tax resident vs Citizen


Resident Individuals

• Ordinarily resident• Physical presence test• Present more than 91 days in each of current and

previous 5 years• More than 915 days in total during the previous 5 years

• Subject to Double Taxation Agreement• Present more than 183 days

• Annual Tax Return for year ending 28 February• Provisional Tax• Taxed on sliding scales with maximum at 40%


Resident Companies

• Incorporated, established or formed in South Africa

• OR• Place of effective management• Compliance with OECD Model Tax Treaty• Protected by Double Tax Treaty• Tax returns based on financial year end• Taxable income taxed at 28%• 6 month, 12 month and final return


Non-resident Individuals and Companies• Taxed on income from a SOURCE within South

Africa• SOURCE refers to where originating cause is

conducted• Certain withholding taxes apply• Royalties 15%• Dividends 15% (5% per DTA)• Interest 15%• Sale of property 5 - 10%• Pay as you Earn Sliding scale

• Annual tax return• Double tax treaty


Main differences between SouthAfrican and French Income Tax

• Different year end Feb/Dec• Central administration covering direct, indirect

and social security taxes• Taxed on individuals and not on household income• No wealth tax• Capital Gains Tax• Individuals 33.33%• Companies 66.67%


Graeme Saggers CA(SA)Nolands Advisory ServicesT 021 658 6600M 082 410 0917E [email protected]

Noland House| River Park | River Lane | Mowbray | Cape Town | 7700 | South Africa

Contact Details


mailto:[email protected]