South Africa
Top Income Tax
45%
Marginal rate
Corporate Tax
27%
Standard rate
VAT / Sales Tax
15%
Standard rate
Capital Gains
18%
Standard rate
Overview
South Africa offers a gateway to the African continent with moderate tax rates and low social security contributions. Cape Town is increasingly popular with digital nomads and has a growing tech scene. The residence-based tax system taxes worldwide income for residents.
Income Tax Brackets
| Income Range (ZAR) | Tax Rate |
|---|---|
| 0 - 237,100 | 18% |
| 237,100 - 370,500 | 26% |
| 370,500 - 512,800 | 31% |
| 512,800 - 673,000 | 36% |
| 673,000 - 857,900 | 39% |
| 857,900 - 1,817,000 | 41% |
| 1,817,000+ | 45% |
ZAR amounts. Tax-free threshold of ~95,750 ZAR for under 65s.
Corporate Tax
Standard Rate
27%
27% standard rate (reduced from 28% in 2023).
VAT / Sales Tax
Standard Rate
15%
Reduced Rates
0%
15% standard. 0% on basic food items, fuel, international transport.
Capital Gains Tax
Standard Rate
18%
40% of gain included in income for individuals (max effective rate ~18%). 80% for companies.
Social Security Contributions
Employee
1%
Employer
2%
Self-Employed
0%
UIF (Unemployment Insurance) only: 1% each. No comprehensive social security.
Special Tax Regimes
Special Economic Zones
Reduced 15% corporate tax rate and other incentives for qualifying businesses.
Eligibility: Must be located in designated SEZ and meet employment/investment criteria.
Pros & Cons
Pros
- Low social security contributions
- SEZ 15% corporate rate
- Gateway to Africa
- Low cost of living
- English-speaking
- Cape Town lifestyle
Cons
- 45% top income tax rate
- No digital nomad visa
- Safety concerns
- Load shedding (power issues)
- Worldwide taxation for residents
Living Indicators
Cost of Living Index
Very affordable
Quality of Life Index
Average
Best For
Data Sources
Tax rate data for South Africa is compiled from the following authoritative sources:
- OECD Tax Database
- Tax Foundation International Tax Competitiveness Index
- World Bank Business Enabling Environment
- South Africa government tax authority publications
- PwC Worldwide Tax Summaries
Last verified: 2024-01
Disclaimer: This content is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making decisions about your tax residency or obligations.