A DTA becomes relevant to a taxpayer’s circumstances if that taxpayer is earning an income for instance in South Africa as well as abroad, or if that taxpayer is a tax resident of South Africa (but has no income from a South African source) and is earning income from a foreign source.
This type of situation often gives rise to a grey area as to where a person can or should be taxed, especially taking into account that a South African tax resident is subject to tax in South Africa on its worldwide income.
Thus, many South Africans living and working abroad may need to consider what their tax treatment legally should be when taking into account the DTA between South Africa and the country they are now residing in. There is the possibility that a taxpayer may need to pay tax on their foreign income in South Africa and utilising a DTA may be an option to ensure this does not happen.
Please Note: Not all countries have a DTA with South Africa. Click here for the full list of countries.