For many South Africans who have spent years abroad, the assumption is that distance settles everything: the new country is home, the salary is earned and taxed there, and the old tax affairs have quietly closed behind them. A growing number of expatriates are discovering otherwise. The South African Revenue Service (Sars) may still regard them as tax residents, which means their worldwide income remains declarable in South Africa, and their compliance obligations have not expired with the years spent overseas.
Does it matter? Yes. It matters whether someone has been outside the country for five years, ten years, or longer. Tax residency is not ended by time or by a change in personal circumstances alone. It is a formal status, and unless it has been properly addressed, Sars may continue to treat a person as South African tax resident, with consequences for how their foreign earnings are taxed and disclosed.
Consider Laura, who has lived abroad for almost a decade. She works there, earns her salary there and pays tax there. Yet a conversation with fellow South African expatriates left her perplexed when someone suggested that Sars could still tax her on her worldwide income. Her confusion is common. Many South Africans who relocated never formally addressed their tax residency status when they left. They built lives overseas and managed their affairs without asking whether their South African tax position had changed.
The distinction at the heart of the matter is straightforward. If Sars still regards a person as a South African tax resident, that person is subject to South African tax on worldwide income, and their foreign income remains declarable locally. If they have ceased to be a tax resident, they will generally only be taxed on South African-sourced income, such as rental income from property in South Africa. The problem is that many expatriates have never established which side of that line they fall on.
Meanwhile, across popular destinations such as the United Kingdom, United Arab Emirates, Australia, Canada and China, more expatriates are recognising the importance of getting their tax affairs in order. Many are proactively reviewing their South African tax residency status and ensuring that their Sars records accurately reflect their circumstances.
Establishing that position, however, is only the first step. Even for those who remain tax resident in South Africa, various forms of tax relief may be available to reduce or eliminate South African tax on qualifying foreign income, depending on individual circumstances and the applicable requirements. What surprises many is that these relief provisions do not remove the need to engage with Sars. They typically require disclosure through a tax return or a formal application process. Regardless of whether any South African tax is ultimately payable, filing obligations remain an important part of maintaining compliance.
The main options depend on residency status and personal circumstances. The Foreign Employment Income Exemption is available to South African tax residents who earn remuneration from foreign employment and meet the prescribed requirements, including employment under a contract and the test of days spent outside South Africa. Where these requirements are met, the first R1.25 million of qualifying foreign employment income may be exempt from South African income tax. The exemption applies only to employment income and does not extend to self-employed individuals or independent contractors.
For those who do not qualify for that exemption and do not wish to permanently cease their South African tax residency, relief may be available under the Double Taxation Agreement between South Africa and the country in which they live and work. These agreements prevent the same income from being taxed in both jurisdictions by allocating taxing rights between the two countries, though their application depends heavily on individual circumstances, making professional advice advisable. For expatriates who are certain they do not intend to return and no longer consider South Africa home, the once-and-for-all application of Financial Emigration to permanently cease tax residency could be the best route.
Whichever option applies, each requires a formal submission to Sars, whether a tax return or an application to cease tax residency. With the assistance of an experienced cross-border tax professional, it is rarely too late to correct past non-compliance. The starting point is ensuring historic tax returns are accurate and up to date, that foreign income has been correctly disclosed where required, that Sars records reflect current circumstances, and that any change in tax residency status has been properly addressed. Depending on the facts of each case, relief may be available through the Foreign Employment Income Exemption, a Double Taxation Agreement, or a backdated application to cease South African tax residency.
The timing is pressing. The deadline for filing annual tax returns falls on 23 October 2026, and expatriates uncertain about their South African tax position should seek professional advice sooner rather than later. Taking the appropriate steps now can provide certainty, restore compliance and ensure that the most suitable relief option is applied.
John-Paul Fraser is the team lead for cross-border taxation at Tax Consulting SA, and Asamkele Tyala is an expatriate tax support specialist at Tax Consulting SA.