* My client was out of the Country, for tax year 2014;2015;2016;2017. * Section 10(1)(o)(ii) of the Income Tax Act No 58 of 1962 * For 12 month period: 183 days/ 60 days Consecutive * He received an IRP'5; I want to claim PAYE paid based on the above sect
Important:
This answer is based on tax law for the year ending 28 February 2017.
Answer:
In order to qualify for the section 10(1)(o)(ii) exemption, a person must be in employment, outside the RSA, for at least 183 full days during any 12-month period. A “full day” means 24 hours (from 0h00 to 24h00). The 183 full days do not have to be consecutive or continuous but, in order to meet the exemption requirements, a total of 183 full days in any 12-month period must be exceeded. It is not necessary to exceed this period by a full day. Calendar days must be looked at, not only work days, when calculating whether a person has been outside the Republic for 183 full days.
A person is then entitled to look both forwards and backwards over any period of 12 months, meaning that some periods may overlap. If the first month in this test does not meet the requirement of the 183-full-days and 60-continuous-full-days, the following month can be looked to, and worked forward or backwards – meaning that the prior month that was looked at first, will be taken into account again in assessing whether the days test was met for the second month.
Note, the period of 12 months is not necessarily a year of assessment, a financial year, or a calendar year; it is any period of 12 consecutive months. The remuneration however, that is exempted by this provision relates to amounts earned from services rendered outside the RSA, if the days tests were met during “any period of 12 months”. The Act refers to the services rendered outside the RSA during the periods of absence.
Once the days absent test was met, the exemption then applies to the remuneration earned in the relevant year of assessment. Remember that remuneration received or accrued by any employee relating to services rendered in more than one year of assessment, is deemed to have accrued evenly over the period during which the services were rendered.
We therefore don’t agree with your view.