Tax advice for Immigrants and Foreigners in South Africa

Income Tax advice for Foreigners

Whether you are a German, French, Dutch immigrant or any other foreign language speaker living and working in South Africa you will need to pay tax. The good news however is that the South African Revenue Services (SARS) will only consider you liable for South African tax purposes if you normally live in the country or are in South Africa for more than 183 days a year.
As a general rule, South African residents are taxed on their worldwide income. This includes the income of a foreign-controlled company. Certain types of income from outside South Africa are exempt and credit is allotted for foreign taxes paid. Non-South African residents; however, are still taxed only on South African-source income.
The tax year is 1st March to 28th (or 29th) February. Tax is payable in instalments by companies, close corporations and those individuals who are classified as provisional taxpayers (e.g. directors of companies and members of close corporations). If you work for yourself then you will need to make two provisional payments to SARS based on estimated tax liability (in relation to previous years’ payments): the first due six months after the beginning of the assessment year (i.e. by the end of August), the second at the end of the assessment year (by the end of February), late payment results in a penalty and interest is payable.
As a foreigner living and working in South Africa, employees' tax is deducted at source (‘pay-as-you-earn’) and paid by employers the tax to the authorities monthly. Under the SITE system (Standard Income Tax on Employees), people earning under R57,000 (€6,224) per year aren’t required to file an annual income tax return.
Income tax rates for the assessment year ending February 2010/11 are as follows:
Taxable Income (R)
Tax Rate (%)
Cumulative Tax (R)
Up to 57,000
18% of each R1
140,000 – 221,000
R25,200 +25% of amount above R140,000
221,001- 305,000
R45,450 +30% of amount above R221,000
305,001 - 431,000
R70,650 +35% of amount above R305,000
431,001 – 552,000
R114,750 +38% of amount above R431,000
552,001 and above
R160,730 +40% of amount above R552,000
A very useful tool to keep at hand is the OLD MUTUAL TAX CALCULATOR