Page 53 - P6 Slide Taxation - Lecture Day 7 - Various Topics

Independent contractors,

• If a person renders services in the course of a trade carried on independently of
the person by whom the amount is paid or payable, and independently of the
person to whom the services are rendered, such a payment is not ‘remuneration’.

• Consequently, these amounts are not subject to employees’ tax and the
classification of a person as an independent contractor is therefore very important

to ensure that an employer meets all his duties in terms of the Act (see 10.11.2).
The wording of the exclusion in par (ii) makes it clear that the following persons can
never be independent contractors:

• a person who is not a resident
• a natural person who is a labour broker (par ( c ) of the definition of ‘employee’)

(see 10.8.2) or who works for a labour broker (par ( b ) of the definition of
‘employee’) or who is declared to be an employee by the Minister of Finance by
notice in the Government Gazette (par ( d ) of the definition of ‘employee’) .

• a personal service provider (par ( e ) of the definition of ‘employee’) (see 10.8.3).

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