Page 31 - Nexia SAB&T Business in South Africa Guide 2024

Definition of Resident
Natural Person:
■ Any natural person who is ordinarily resident in SA, or
■ Any natural person who is not ordinarily resident in SA but who:
■ is physically present in SA for a period exceeding 91 days in aggregate
during the current year of assessment and for a period exceeding 91 days
in aggregate during each of the prior 5 years of assessment; and was
physically present in SA for a period exceeding 915 days in aggregate
during the previous 5 years of assessments.
■ where a person has been outside of SA for a continuous period of at
least 330 full days after he ceases to be physically present in SA, he will
be deemed to not have been resident from then.
■ South African resident employees who render services for any employer
outside SA for a period which in aggregate exceeds 183 full days
commencing on or ending during a period of assessment, and for a
continuous period exceeding 60 full days during such 183 day period,
will not be liable for income tax on their remuneration for that period.
However, effective 1 March 2020, any such remuneration received in
excess of R1.25 million will be subject to normal tax in South Africa,
irrespective of whether tax is paid in another country.
Companies and Trusts
A company and Trust will be considered to be resident for tax purposes if it is
incorporated, established, formed or has its place of effective management
in SA.
Controlled Foreign Companies (CFC)
A Controlled Foreign Company (CFC) means any foreign company where more
than 50% of the total participation rights or voting rights are directly or indirectly
exercisable by one or more residents. South African residents must impute all
income of a CFC in the same ratio as the participation rights of the resident
in such a CFC, subject to a number of exclusions. Net income of the CFC is
defined as the CFC’s taxable income determined as if the CFC is a South African
taxpayer.

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