HOW TO SET UP IN CAPE TOWN
South Africa has a well-developed and regulated taxation regime. While the laws are constantly being revised and amended to keep them up to date and in line with international best practice, here are the tax basics for foreigners investing or working in South Africa.
The tax regime is set by the National Treasury and managed by the South African Revenue Service (Sars).
Our services include, amongst others:
- Individuals who are South African residents are taxed on their worldwide income.
- Non-South African residents are only taxed on income from a source in South Africa.
- There is no group taxation in South Africa – so each company is taxed as a separate taxpayer.
- Partnerships are not recognised as separate entities for income tax purposes and are fiscally transparent. Instead, the individual partners are taxed separately on their share of the partnership profits.
- A company is regarded as a South African resident if it is incorporated in South Africa or if it has its place of effective management in South Africa.
- Businesses may select their own financial year-end. For individuals, the tax year runs from 1 March to 28 February.
- Businesses must file annual income tax returns with Sars. It is also a legal requirement for all companies and close corporations to file annual returns with Companies and Intellectual Property Commission annual basis. See www.cipc.co.za for more.
- Special dispensations are provided for companies who derive their income from mining, gold mining, oil and gas, and farming. See www.sars.gov.za for details.