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International Tax and Tax Treaties

Posted 15 January 2014

Dear Tax Tim

I earn international income as an individual (not a registered company ) on a monthly basis, what type tax will I be liable for in South Africa? Will I have to pay standard income tax in South Africa?

I earn this whilst in South Africa and not abroad as a monthly commission payout. How does tax treaties apply to foreign income or will this not be applicable to individuals?

TaxTim TaxTim says:
16 January 2014 at 19:56

You are earning income in South Africa, as a resident, whilst based in SA. Therefore you will be taxed on your worldwide income. Do you pay tax in that country where you earn the money from?

JoeTax says:
17 January 2014 at 6:48

Thank you for the response. Currently I dont pay tax in the country ( Indonesia ) I earn the money from. However I am able to structure it this way if need be.

What is the worldwide income tax rate in South Africa?
Would it be best to pay the tax in Indonesia?
Should I pay tax in Indonesia will I be exempt from paying income tax in South Africa?

TaxTim TaxTim says:
17 January 2014 at 14:18

If there is any tax to be paid in Indonesia then you will only be able to use this as a credit or deduction against the tax in SA. However you are still subject to normal taxes as a South African earning Rands in SA would be according to the SARS tax rates 2014

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