Tax on Non-residents - Layman Version
Simplified Guide to Tax for Non-Residents in South Africa (2025 Update)
- What’s New? As of 28 July 2025, SARS (South African Revenue Service) has updated the way non-residents file their tax returns. If you’re a South African who no longer lives in South Africa but still earns income from South Africa (like rent, pension, or interest), you now have a simpler way to submit your tax return for the 2025 tax year.
- What’s Changed? SARS has made it easier for non-residents to complete the correct sections of the tax return form (called the ITR12). You’ll now need to activate the “non-resident” part of the form. This is done through the SARS Online Query System (SOQS) before you access your tax return on eFiling.
Steps to Activate the Non-Resident Section:
- Go to the SARS homepage and click the SOQS icon.
- Select “Non-Resident Tax Return Type”.
- Fill in your personal details.
- Once verified, SARS will send a One-Time Pin (OTP) to your contact details.
- Select the 2025 tax year and answer the questions provided.
- Your tax return will now be set up correctly and ready for eFiling.
Note: SARS will remember this information for the next tax year, unless your situation changes.
Understanding the South African Tax System South Africa uses a residency-based tax system:
- Residents pay tax on all their income, no matter where it was earned.
- Non-residents only pay tax on South African-sourced income.
- To avoid being taxed in two countries, South Africa has agreements with many countries called Double Taxation Agreements (DTAs). These agreements help decide which country has the right to tax a specific type of income.
- Who is a Non-Resident? To understand if you’re a non-resident, we first need to explain who is a “resident” for tax purposes. There are two ways to be considered a tax resident:
- Ordinarily Resident – You are considered ordinarily resident if South Africa is your true home — the place you return to after being away.
- Physical Presence Test – You’re considered a resident if:
- You spent more than 91 days in SA during the current tax year, AND
- More than 91 days in each of the previous 5 years, AND
- More than 915 days total in the past 5 years.
- If you don’t meet either of these conditions, then you’re a non-resident.
- Also, if you were a tax resident but left SA and have been out of the country for 330 full days in a row, your residency status ends on the day you left.
- For details on how to formally stop being a tax resident, check SARS’s “Cease to be a Resident” page.
Types of Income and How They’re Taxed
- Employment Income If you work in South Africa while being a non-resident, your salary is usually taxed in SA — unless the DTA with your country says otherwise.
- To be exempt from SA tax on your salary, all of the following must apply:
- You are in SA for less than 183 days in any 12-month period.
- Your salary is paid by a non-SA employer.
- Your salary is not paid by or linked to a business your employer runs in SA (called a “permanent establishment”).
- Pension and Annuities If you get a pension or lump sum from a South African fund, and you earned that through services you rendered in South Africa, you will be taxed in SA on that amount.
- If the pension or annuity relates to both SA and non-SA work, only the SA portion is taxed in SA. Also, pensions from contracts started in SA are seen as South African income, even if you’re now living abroad.
- Again, a DTA may reduce or remove this tax.
- Interest Income If you earn interest from SA sources (like a bank), here’s how it’s taxed:
- It’s not taxed if:
- You were in SA for less than 183 days in the past 12 months; AND
- The money isn’t tied to a SA-based business you run.
- It’s taxed at 15% withholding tax if exempt from normal tax (unless a DTA says otherwise).
- If you were in SA more than 183 days, your interest is taxed as normal income. You can claim a basic exemption:
- R34,500 if you’re 65 or older.
- R23,800 if younger than 65.
- It’s not taxed if: