I left South Africa (“SA”) after school to study abroad. I accepted a job offer in the United Kingdom (“UK”), where I was studying, after my graduation. I have been living outside SA ever since. I recently married a UK resident and plan to stay in the UK permanently, and only return to SA on holiday and to visit my father over Christmas. I have never been registered in SA for tax purposes as I have never earned any income here and was not required to registered for tax. I have a SA and UK passport. My father has now passed away and I am to inherit his entire estate of about R70 million in value. What now?
The above scenario plays itself out frequently.
I was born in SA and thus I was ordinary resident here for tax purposes, even though I was never registered on the SARS e-filing system as a resident taxpayer.
I should make sure:
- That I am on record with SARS as a non-resident for tax purposes in SA;
- Before doing so, that I never had any source income in SA over the years that should have been declared to SARS;
- When I became non-resident for tax purposes in SA. Was it the day when I accepted the job offer in England, or when I got on the plane to go and study abroad, or did I only change my intention to stay permanently when I married a UK resident? This will very much depend on my intention.
I should:
- Put the date of my non-tax residency on record with SARS,
- Calculate the capital gains tax (“CGT”) payable on this event in line with SA tax laws,
- Pay it to SARS,
- Obtain advice if I need to lodge an application in terms of the Voluntary Disclosure Program (i.e. if I understated my SA source income or CGT and no refund is due to me as a result of the understatement), and
- Then do so if need be.
SARS has recently made a form available that I can complete to put my non-tax residency on record, especially in instances where I have never been registered on the SARS eFiling system, and to avoid the need to now register an e filing profile. The form can be found here:
https://www.sars.gov.za/individuals/cease-to-be-a-resident/
If you need formal advice or assistance relating to any of the above, kindly contact suzanne@fidelisvox.co.za.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)