The South African Revenue Service (SARS) appears to be able to track a person’s flights as part of a stricter emigration process, says Nikolas Skafidas, a tax expert from Tax Consulting SA.
He said that expatriate taxpayers awaiting approval for their non-resident status might have their flights tracked into and out of South Africa by the tax authority.
This follows a trend of SARS actively implementing a more rigorous verification and auditing process on non-residence applications.
Skafidas noted a recent Request for Additional Supporting Documents letter received by one of Tax Consulting SA’s clients.
In the document, SARS queries the reasons for the emigrated taxpayer’s recent visits to the country – the list request lists four specific airport arrivals and departures for that person, he added.
Skafidas said that SARS is most likely to have obtained the flight logs of specific people through the Department of Home Affairs “Track and Trace” systems at airports.
Flight details could possibly be used by SARS when questioning the validity of an applicant’s claim that they intend to reside outside of South Africa permanently.
“Permanent departure is the core condition for the approval of non-resident status for tax purposes.”
Once a person has ceased tax residency they no longer have to pay tax on their worldwide income but are still required to declare any local earnings. Skafidas added that expatriates are able to come and go freely in South Africa – provided they remain in the country for no more than the prescribed period.
When ceasing tax residency, prospective expats must show clear objective evidence of their intention to remain abroad.
“Regardless of this trend, expatriates entering South Africa for casual holidays, to visit family, or even for business should not be concerned. This is provided they have a good understanding of the conditions of their non-resident approval or continued non-residence status and have planned their stays accordingly” said Skafidas.