Page 99 - P6 Slide Taxation - Lecture Day 7 - Various Topics

Unilateral reliefs

Exemption for foreign employment income
• Remuneration earned by officers and crew members on board ships engaged in

international transport of passengers or goods for reward or in certain maritime
mining activities will be exempt from income tax if the person was outside South
Africa for more than 183 days during the year of assessment (s 10(1)( o )(i)).

• A similar exemption is available for remuneration earned by a person as an officer
or crew member of a ship that is registered as a South African ship that is engaged
in international shipping of passengers or goods (see s 12Q – see chapter 5) or
fishing outside South Africa. If the person is employed on a domestically flagged

ship, the remuneration earned is exempt irrespective of the number of days spent
outside South Africa (s 10(1)( o )(iA)).
• Persons earning foreign sourced employment income, other than as officers or

crew members aboard ships, may also enjoy an exemption on the period spent
outside South African in rendering the service (s 10(1)( o )(ii)). To a large extent,
the periods in this provision correspond to those in tax treaties (see 21.4.3.5).
• For years of assessment commencing on or after 1 March 2020, this exemption will

only apply to the first R1 million of income earned from services rendered outside
South Africa. The exemption does not apply to persons working abroad while
deriving income from the South African government.

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