This is a question which is related to the question posted below:
Posted 2 December 2013 under Tax Questions
I'm a South African currently residing in the UK (and have done so for the past 10 years). I will be returning to South Africa as a resident but will still be earning pounds (This is a salary I'm earning from the UK. I basically do Marketing work for a UK based company and get paid in pounds into a UK bank account and also pay taxes in the UK). What is my obligation towards SARS?
My question is as follows:
When declaring this salary and the taxes paid in the UK as a rebate/credit to SARS, what exchange rate must be used?
A specific exchange rate is used by the foreign bank when transferring the money, if this differs from the exchange rate used by SARS, can this difference be used to reduce the salary earned or used as a rebate/credit against the salary?
When transferring the money back to SA, there are various fees and charges that are incurred, can these amounts be deducted against the salary earned or be used as rebate/credit?
Are there any tax implications when bringing the money back into the country?
When must the salary be declared to SARS, from the date you move back or when you become a resident i. E. 183days after moving back assuming you move back on the 01/03/2015?
In theory you will become a resident as soon as you come back to SA because as being born here makes you an "ordinary resident'' thus someone who intends to settle in SA. So you would need to start paying tax in SA as soon as you begin earning whilst being back here, unless of course you fall under the foreign employment exemption requirements for that particular year.
SARS does allow you to translate at their average rates which is updated and published on the website each year or you can make use of the exact amount that came into your account in RANDS after all the extra fees have been deducted.
Tonysays: 21 May 2015 at 8:06
Thanks Tim. Really appreciate the informed response.
TaxTimsays: 21 May 2015 at 13:12
Only a pleasure - glad we could help!
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