Authors: Lesedi Seforo (SAIT) with contributions by Alan
On 17 May 2013, the renegotiated double tax treaty between
RSA and Mauritius was signed. The renegotiated double tax treaty will come into force as
from 1 January 2016.
As anticipated, article 4(3) of the treaty contains a revised so-called
"tie-breaker” clause. It states that in cases of dual residence in respect of an entity, the competent authorities of both countries
must mutually agree on which jurisdiction such person will be considered a
resident for treaty purposes. In other words,
automatic treaty resolution of dual residence will no longer exist (as was the
case under the former treaty).
However,a Memorandum of Understanding (MOU) between
RSA and Mauritius has recently been signed that provides the competent authorities (i.e. revenue
authorities of both countries) will consider a number of factors when seeking mutual resolution of dual entity
These factors include:
where board meetings are held
where the CEO and senior executives usually carry on their activities
where the senior day-to-day management is conducted
where the person’s senior headquarters are
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.