There’s been a whole lot of hype about how foreign income will be taxed in this country in 2019.
Some people are even choosing to come back home to work now, because there is no financial benefit to being away from their families for so long any more.
What has been proposed is that the taxable income needs to be declared here in South Africa, and the tax calculated accordingly, with any taxes already paid in the foreign country being allowed as a deduction, with the balance outstanding (in the case where the tax rate in the foreign country is more favourable than ours) being considered a debt due to the state.
This could be a bit disastrous, depending on how you see it. I look at the foreign income that, although not taxed here, is certainly spent here. That could be lost on a large scale. And another problem could be that we would have a massive exit of residents choosing to emigrate to the country they are employed in. On the other hand, of course, SARS are saying that most of the people benefiting from the current s10(1)(o)(ii) exemption are not paying tax in the other country anyway as they’re not deemed resident there, so why not claim the tax and boost our infrastructure accordingly.
The public are allowed to comment on the proposal. If this affects you it is advisable that you do.