Does tax residency standing affect your means to obtain an SA inheritance?

The finalisation of a deceased property is in itself a time consuming and irritating course of for South Africans. Further complexity and exasperation is precipitated when one of many heirs is an expatriate.

When inheriting from an SA supply and you might be residing exterior of SA, you might be required to have positioned your emigration on file as a way to obtain that inheritance. Expatriates might want to present proof of their non-tax residency and compliancy standing to have the ability to obtain their inheritance overseas.

To be famous as a non-tax resident you’ll have to undergo a proper declaration course of with the South African Revenue Service (Sars) whereby you will want to show your non residency primarily based on the qualifying standards.

The answer

To be capable of show to your non-residency, and formally stop your tax residency you will want to undergo the monetary emigration course of must you meet the factors.

This is a once-off course of whereby taxpayers can stop their tax residency if they’ve the intention to relocate to a different nation completely. If you have got the intention to reside overseas completely and the intention can objectively be substantiated, you’ll break the ordinarily resident take a look at and qualify to stop your tax residency.

In 2001 SA dissolved the source-based tax system and changed it with a residency primarily based taxed system. Under the brand new system you may be differentiated between a resident and a non-resident for tax functions. A resident for tax functions is taxed on their worldwide earnings and a non-resident for tax functions is taxed on their earnings derived from a supply inside SA.

When a person was by no means ordinarily resident in South Africa a bodily presence take a look at is utilized to find out if a person is a tax resident in South Africa.  In phrases of this take a look at, a person have to be current in South Africa for a interval or intervals exceeding 91 days in mixture throughout the present yr of evaluation and, exceeding 91 days in mixture throughout every of the 5 years of evaluation previous the present yr of evaluation and, exceeding 915 days in mixture throughout the 5 years of evaluation previous the present years of evaluation.

This take a look at is seen as a secondary take a look at to the ordinarily resident take a look at.

It is necessary to notice that the onus is all the time on you, the taxpayer, to show to Sars that you just qualify for the above choices.

This is, nonetheless, a really sophisticated and technical course of that’s finest performed via professionals who’re skilled on this space.


Once you have got declared your formal emigration and it has been accredited by Sars, you’ll be then issued with an Emigration Tax Clearance Status pin which will likely be used as a clearance certificates to launch the inheritance and could also be used to remit your inheritance overseas.

The inheritance funds are blocked, and the taxpayer is required to fulfil this obligation earlier than the inheritance may very well be acquired.

There is not any inheritance tax on the person in South Africa, nonetheless the inheritance does nonetheless have to be declared to Sars, for each SA tax residents and tax non-residents.

Victoria Lancefield is GM of monetary emigration & tax residency and Martin Bezuidenhout is an expatriate tax lawyer at Tax Consulting SA.

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