Dear Anonymous, Please see our initial introduction at the top of the page for information on financial emigration, the dual taxation agreement as well as our two tax residency tests.
- Provided that these persons are South African tax residents, expatriate tax law will be applicable to them and they are therefore required to declare local and foreign earnings. Thus, they are required to submit returns declaring their income earned abroad the ship and are obligated to do so.
- This income can, however, be exempt, provided that the exemption criteria is met, under section 10(1)(o)(ii) whereby the foreign employment income will be fully exempt from taxes in SA. This will be in place until March 2020, thereafter the exemption has been restricted to exempt only the first R1 million with the excess being subject to taxation in SA.
- In certain circumstances one will be able to exempt the income earned abroad the vessel under section 10(1)(o)(i), also referred to as the seaman’s exemption, which has not been amended and will still fully exempt the income come March 2020.
- Please note that section 10(1)(o)(ii) cannot be applied to all employee’s working aboard the vessel as this is only in place for employees who are part of the safe passage or navigation of the ship.