Thinking about moving back to South Africa from the UK? Whether it’s for family, lifestyle, or just a change of pace, there’s a lot to look forward to. But before you book that one-way ticket home, it’s important to wrap your head around something many returning expats overlook — your tax residency status.
South African tax can be complex, especially when you’ve been abroad for years and have income coming in from different parts of the world. Let’s walk through the key things you need to know about tax residency in South Africa, how the South Africa–UK Double Taxation Agreement works, and what happens to your UK income once you’re back.
Moving back to South Africa from the UK – so, are you a tax resident now?
This is probably the first question you need to ask yourself. Your tax residency status will determine whether SARS sees you as liable for tax on your worldwide income, or just on what you earn inside South Africa.
There are two ways SARS decides if you’re a resident for tax purposes in South Africa:
- Ordinary residence test: If you’re coming back to settle in SA for good — maybe buying property, moving the family, enrolling kids in school — you’ll likely be seen as ordinarily resident from the moment you land.
- Physical presence test: You don’t have to live in South Africa permanently to be seen as a tax resident. If you spend a significant amount of time in the country over five years, you could meet the requirements. This includes being in South Africa for more than 91 days in the current year, more than 91 days in each of the previous five years, and a total of more than 915 days over those five years.
If either test applies, SARS will consider you a tax resident in South Africa, and that means your global income (including your UK salary or pension) may be up for local tax — unless there’s a treaty to help you out. More on that below.
Read more: South African tax residency rules – expats, are you still tax residents of South Africa?
The South Africa–UK double tax agreement – your safety net
Here’s where things get a little easier. Thanks to the Double Taxation Agreement between South Africa and the UK, you won’t get taxed twice on the same income.
This DTA outlines which country has the right to tax what, whether it’s your UK pension, rental income, dividends, or capital gains. So, for example, if you’re receiving a UK pension while living in South Africa, you may be taxed on it locally — unless it qualifies for exemption under Section 10(1)(gC) of the Income Tax Act. This exemption applies only to certain foreign pensions earned from employment abroad, and specific conditions must be met. Always check whether your pension qualifies and whether the UK has already taxed it, as relief under the UK-SA Double Tax Agreement may apply — but is not automatic.
It’s important to understand how the South Africa–UK tax treaty applies to your specific income streams. Even though you might not owe tax in both countries, you still need to report all foreign income to SARS. The South African tax on foreign income rules are strict, and compliance is key.
Moving back to South Africa after years away? Here’s when you’re a tax resident again:
Let’s say you left South Africa years ago and formally underwent financial emigration, which at the time meant you were classified as a non-resident for exchange control purposes by the South African Reserve Bank (SARB).
Now, with financial emigration no longer applicable, tax residency is determined solely by SARS, based on where your ties and centre of life are. If you’re planning to return to South Africa, it’s important to understand that SARS may consider you a tax resident again once you re-establish personal, economic, and residential ties, especially if South Africa becomes your primary home.
Best practice? Before returning, it’s advisable to finalise your tax emigration process with SARS if you haven’t done so already. This helps ensure clarity on your status. Once you’re back in the country and your circumstances change, you can update your details using the RAV01 form via eFiling to reflect your new tax residency position.
Read more: Returning to South Africa after financial emigration – what expats need to know about coming home.
What happens to your income once you’re a tax resident again?
Once you’re back and seen as a South African tax resident, SARS will tax you on your worldwide income, including:
- Salaries or consulting fees from the UK
- Rental income from UK property
- Dividends and interest from offshore investments
- Capital gains from selling overseas assets
You might be able to claim a foreign tax credit for tax already paid in the UK. Still, you need to be proactive. There are strict rules about how and when you declare this income, and penalties for getting it wrong. If you’re unsure, this is a good time to get expert advice.
Read more: Warning – SARS is monitoring South African expats abroad who want to return home.
Should you sell UK assets before or after you move back to South Africa?
Good question. Timing matters, especially when it comes to capital gains tax in South Africa. If you sell an investment property, for example, after you’ve become a SA tax resident again, SARS may want a slice of the profits. Some people choose to sell assets before they move back to South Africa, to avoid that. Others wait until they’re back and accept the tax bill. There’s no right or wrong – it depends on your financial goals. Just make sure you’re making an informed decision with the help of a cross-border tax specialist.
Returning to South Africa from the UK – a few financial things to keep in mind
There’s more to think about than just income. Here are a few other tax-related issues to consider as you plan your return:
- Controlled foreign companies: If you have offshore business interests, SARS may want to tax those profits too.
- Money transfers: Bringing large sums into South Africa? There could be tax implications of bringing money into South Africa, so speak to a professional before making big moves.
- Transferring a UK pension to South Africa: While not straightforward, it is possible, but you’ll want to weigh up the pros, cons and tax consequences.
Expat returning to South Africa? Before you leave the UK, do this:
Before saying goodbye to Britain for good, make sure you:
- Inform HMRC that you’re leaving
- Close or manage any UK tax obligations
- Decide whether to keep property or bank accounts
- Speak to a tax consultant to help coordinate the move
- Get documentation ready for SARS (like proof of your return date and any tax residency certificates)
Read more: Returning to South Africa? Tax implications for the non-compliant expat’s homecoming.
Returning expats must come home with a clear plan.
South African expats returning home often underestimate how tricky the tax side of things can be. But with a little planning and the right support, you can minimise the nasty surprises. Whether you’re going back to South Africa for good or still juggling some UK income streams, it’s important to know how the South Africa-UK double tax treaty works and what your responsibilities are as a tax resident in South Africa.
Ready to move home – and sort out your tax while you’re at it? At FinGlobal, we specialise in helping expats like you make a smooth (and compliant) return. From tax residency advice to exchange control and financial planning and paperwork, we’ve got your back.
Leave your contact details below, and we’ll be in touch with expert cross-border tax guidance to assist with your return to South Africa.