South Africa: Enhancements to tax compliance status process

A new enhanced tax compliance status (TCS) application form introduced.

15 May 2023

The South African Revenue Service (SARS) on 21 April 2023, introduced a new enhanced tax compliance status (TCS) application form to facilitate the consolidation of the foreign investment allowance (FIA) and emigration TCS applications into a single application, referred to as “Approval International Transfer (AIT).” The system became effective on 24 April 2023.

What to expect

South African residents who want to transfer funds offshore require a pin from SARS that allows third parties to view the taxpayers’ current tax compliance status online.
The new TCS system makes it easier for taxpayers to request their TCS via SARS eFiling or the SARS Online Query System (SOQS) to receive a PIN that can be used to authorise and enable third parties to verify their tax compliance status – in particular, when transferring funds abroad.
The tax compliance request form (TCR01) has been amended to align to the required changes.
No TCS is required for transfers up to ZAR 1 million per calendar year.
Non-tax residents wishing to transfer funds abroad need to complete the process of notifying SARS of their cessation of tax residence and complete the RAV01 declaration on e-filing.
The “Tender” option was removed, and the “Good Standing” TCS needs to be used going forward, for all other scenarios when a third party wants to verify a taxpayer’s tax compliance status.

Required documentation for new AIT application

When taxpayers apply for a TCS in respect of international transfers, they are required to submit the following supporting documentation:

Specific documents showing the sources of the capital to be invested
Statement of assets and liabilities (local and foreign) for the previous three tax years
If the taxpayer is a nonresident for tax purposes in South Africa, relevant proof that the taxpayer ceased to be a resident for tax purposes, including the date on which the taxpayer ceased to be a resident
Details of any locally listed securities that the taxpayer will be transferring to an exchange that is outside South Africa
Applicable power of attorney when the TCS application is submitted by a person other than the taxpayer

Read a May 2023 report [PDF 197 KB] prepared by the KPMG member firm in South Africa

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.