Expatriate Tax remains a burning topic even after the implementation of the foreign employment exemption as from 1 March 2020.

Many tax advisers, financial planners and payroll departments of multinational companies, as well as companies employing foreign nationals in South Africa, are grappling with the impact of the law on employees’ tax compliance obligations, mitigating the risk of potential double taxation and how to structure their payroll.

The framework of taxation of internationally mobile employees was also subject to the amendment that saw the phasing out of the SARB emigration process that allows for the withdrawal of retirement interests (“formal emigration”). This amendment took effect from 1 March 2021 and has created uncertainty among the expatriate community, particularly regarding their residency status for South African tax purposes.

• Proactive steps that can be taken to remain compliant and manage expatriates’ tax liability in South Africa following the amendment to the foreign employment exemption.
• Practical planning points that go beyond tax advice, including SARS audit strategies.
• The phasing out of SARB formal emigration, and the new process for those who wish to withdraw retirement interests when they cease South African tax residency.
• The proposed amendment to tax retirements interests upon ceasing residency.