I am starting a new position with a multi-national US based company, and my letter of appointment lists my hourly rate as "net of tax". I am not sure what this means, and was hoping you would be able to shed some light. How are my tax implications affected? Do I need to register for provisional tax?
If the US company withholds tax from your pay then they would need to issue a tax certificate stating this and the amount withheld and what percentage they are applying. You would declare this on your Income Tax Return and show the foreign income, the taxes charged and taxes paid in the US. SARS will then calculate whether or not you would need to pay any additional tax.
You would need to register as a provisional taxpayer as you are not earning remuneration in South Africa and paying tax over to the South African authorities. Learn more about provisional tax.
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