My client did contract work in Zambia. Is the income taxable?
Important:
This answer is based on tax law for the tax year ending 28 February 2018.
Answer:
Article IX of the RSA / Zambia treaty is relevant to the right to tax the income.
With regard to the exemption, section 10(1)(o)(ii) requires that there must be remuneration in respect of services rendered by an employee for or on behalf of an employer. If the services are rendered in an independent capacity, the exemption doesn’t apply. SARS confirms this in their practice generally prevailing when they say that “the term “employee” is not defined in the main body of the Act, and so must be given its ordinary meaning. An “employee” under the common law excludes an independent contractor or self-employed person.”