Double Tax Agreements
South Africa has close to one hundred DTAs with countries across the world. Each of these agreements, in turn, may be subject to certain amending protocol or the influence of the Multilateral Instrument. The primary objective of a DTA is to eliminate double taxation, to promote fairness, inter-state justice, and ensure non-discrimination against taxpayers.
Let us help you ensure you’re paying taxes in the correct country, at the correct rate, and without the disadvantage of being 'double taxed'.
Further, a common issue in regard to the DTA is whether there is a permanent establishment (PE).
A PE is created by a non-resident company in South Africa due to its business activities or “presence” in South Africa, the same could apply for South African companies with business activities/"presence" in foreign countries. Generally, this will be due to the company having a fixed place of business through which the business of the company is conducted, however there are specific inclusions relating to agents and service providers. The PE concept is an internationally recognised principle and forms part of most double tax agreements. Thus, the PE rules may create tax consequences for South African companies doing business abroad and for foreign companies doing business in South Africa.
We assist the abovementioned companies in assessing their PE risk from both a South African and international perspective.