Q: My client came from GBR (and has dual citizenship with Mauritius) to
South Africa and in April 2013 she received an IRP 5 and was taxed on the
money. She now wants all the PAYE back but she did not comply with section
10(1)(o) exemption and still works in SA. She also wants to submit her tax in
Mauritius because we have a double taxation agreement and believes she must not
pay PAYE in South Africa. Is this correct?
A: You state that the client ‘come
from GBR and has dual citizenship with Mauritius. We assumed that she is
not a resident of the RSA, but don’t know of which country she is a tax
resident. Please note that citizenship is not relevant in this
case. As you indicated that the client came to the RSA in "April 2013” we
assume that the remuneration, in respect of which the IRP5 was issued, is in
respect of an employment derived by the recipient who was present in the RSA for
a period or periods exceeding in the aggregate 183 days in any twelve-month
period commencing or ending in the fiscal year concerned. You are correct
that section 10(1)(o) does not find application here as the services was not
rendered outside the RSA.
Africa therefore has a right to tax the income (both where she is a resident of
the UK or Mauritius). If a double tax arises the other country will have
to provide a rebate or other relief.
Disclaimer: Nothing in this query and answer should be construed as
constituting tax advice or a tax opinion. An expert should be consulted for
advice based on the facts and circumstances of each transaction/case. Even
though great care has been taken to ensure the accuracy of the answer, SAIT do
not accept any responsibility for consequences of decisions taken based on this
query and answer. It remains your own responsibility to consult the relevant
primary resources when taking a decision.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.
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