After SARS announced its plans to repeal the foreign employment income tax exemption for those who work outside the country for less than 184 days, those who would potentially be affected were obviously not that happy.

Like, at all.

So what did they do? They started to campaign and complain on Facebook of course.

Speaking to MPs on Tuesday, the SARS group’s executive for legal policy and research, Franz Tomasek, explained that about 8 000 people had protested against the measure on Facebook, reports Sowetan Live.

But instead of interpreting the cries as a desperate plea to leave the 184-day tax exempt rule as is, Tomasek saw it as a negative, saying that:

[T]he number of protesters was an indication that there were far more people who had left the country than the 5 109 individuals who declared non-taxable foreign remuneration in 2014/15.

Sorry, folks.

Now, to get away with it, people really are going to have to declare themselves as “non-tax residents” – or execute a bit of “financial immigration” – through SARS.

The result? A whole lot more confusion:

South African taxpayers will be entitled to claim a foreign tax rebate against their South African income tax for any foreign taxes paid in any other country in respect of that remuneration.

Just call Galbraith | Rushby if you need any clarification, because its not going to be easy.

Speaking to Business Tech, Jenny Klein, a principal associate at ENS Africa, explained that the new laws will introduce a number of issues:

One of the biggest issues that arises in relation to claiming foreign tax rebates, is that this may only be done in the employee’s annual tax return.

“There is currently no mechanism for taking foreign tax rebates into account for purposes of employees’ tax (pay-as-you-earn “PAYE”) withholding.”

“This may result in an employee who is on a South African payroll being subject to PAYE in South Africa and foreign withholding tax in the country of source (ie where the services are rendered), without being able to offset the foreign tax against the PAYE.”

The only way to get around this would be to get a directive directly from SARS, she said. However any refunds due by SARS in respect of the foreign tax rebate claimed in the employee’s tax return may also take some time to be processed and paid.

“As a result, there would be cash flow implications for the employee or for the employer if the employer pays the taxes due on behalf of the employee in terms of a tax equalisation policy,” she said.

The matter will more than likely require you to get a financial and tax advisor on board, and our first choice is Galbraith | Rushby, a local firm which can offer solid financial advice, as well as help you with any other tax issues.

But get this:

While SARS is sitting pretty and finding guilt in our complaints about the 184-day tax rule, they should be turning their gaze inwards and taking a good hard look at the significant increase in complaints against them to the ombudsman, nogal – from Business Day:

In the 2013-14 financial year, 156 complaints were lodged, but note the escalation in the subsequent years: 2014-15 – 1,270; 2015-16 – 2,133; and 2016-17 – 3,188.

How can we trust a service that cannot resolve disputes with taxpayers on its own?

Eish, guys.

[source:businesstech&businesslive&sowetan]