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HMRC internal manual

International Manual

DT Agreements: South Africa - Income from a UK source paid to a resident of South Africa

Subjection to South African tax and the change to a ‘residence basis’ systemof taxation in South Africa

Before 2001, the South African tax system was primarily ‘source based’. Thismeant that only income that originated from a source in the Republic of South Africa, orincome that was deemed to be from a source within the Republic, was taxable there. For taxyears commencing on or after 1 March 2001, South Africa moved to a ‘residencebasis’ of taxation. Broadly, this means that South African residents are now taxed ontheir world-wide income. However there are some exclusions from this rule. In particular,see INTM361090 about annuities.

For periods before 6 April 2003, subjection to tax in South Africa is a condition ofrelief from UK tax under the 1969 Convention. If you receive a claim that includesincome paid before 6 April 2003 and are in doubt as to whether the income issubject to tax in South Africa, refer the claim to DT Technical Advice.