South Africa Tax Residency Guide

Ordinary Residence Test

An individual is considered ordinarily resident in South Africa if the country is their natural or usual home — the place to which they naturally return after periods of absence. This is a question of fact determined by all relevant circumstances, including physical presence, family connections, property ownership, social and economic ties, and intention. The test looks at whether an individual has a real and continuous home in South Africa that is more than a temporary or occasional residence.

Key factors considered by SARS include: the location of the individual's permanent home (owned or leased), the location of their spouse and minor children, the location of their business and employment, the frequency and duration of visits to South Africa, and their intentions regarding where they consider home. If an individual is ordinarily resident, they are taxed on worldwide income regardless of how many days they spend in South Africa. This test is applied first; only if the individual is not ordinarily resident does the physical presence test come into play.

Physical Presence Test

If an individual is not ordinarily resident, they will still be treated as a tax resident if they meet all three requirements of the physical presence test in a given tax year:

(1) Physically present in South Africa for at least 91 days in the current tax year;
(2) Physically present in South Africa for at least 183 days in total during the current tax year and the five preceding tax years; and
(3) Physically present in South Africa for at least 183 days in the current tax year.

All three conditions must be satisfied. Days of physical presence count whether or not they are consecutive, and both partial and full days count towards the total.

Ceasing to Be a Resident

An individual ceases to be a tax resident when they no longer meet either the ordinary residence test or the physical presence test. For those who were ordinarily resident, ceasing residency requires a clear break — leaving South Africa permanently or indefinitely, with evidence such as selling or leasing out the family home, moving family abroad, resigning from South African employment, and establishing a new home in another country. SARS may request a letter of intent and supporting documentation to confirm the change.

Under the physical presence test, residency ceases when the individual no longer meets the 91-day or 183-day requirements. This typically means spending fewer than 91 days in South Africa in a tax year or fewer than 183 days in total over the current and five preceding years. However, the physical presence test continues to apply for five years after departure — if an individual returns for more than 91 days in a future year, they may be deemed resident again for that year. For former ordinarily resident individuals, there is no such five-year tail; residency ends as soon as the ordinary residence test is no longer satisfied.

Exit Charge (Deemed Disposal)

When an individual ceases to be a South African tax resident, they are deemed to have disposed of their worldwide assets (excluding immovable property located in South Africa) at market value on the day before they ceased to be resident. This triggers a capital gains tax (CGT) event on the unrealised gains of those assets. The effective CGT rate for individuals is 7.2% to 21.6%, depending on marginal income tax rates (40% inclusion rate × 18–45% marginal rate).

Tangible movable assets (e.g., cars, furniture, personal effects) with a value below ZAR 50 million in total are excluded from the deemed disposal. Immovable property located in South Africa is also excluded because it remains subject to South African CGT even after the owner ceases to be resident — the property is considered South African-source and remains within SARS's taxing jurisdiction. Taxpayers can elect to defer the exit charge by providing security to SARS, but interest may apply on the deferred tax.

Residency Summary Table