Authored by: Jean du Toit, Head of Tax Technical & Reabetswe Moloi, Admitted Attorney at Tax Consulting South Africa

South Africans emigrating to greener pastures may be prevented from leaving the country - or worse - if their application for tax clearance is denied by SARS.

Recent changes to expatriate tax procedures and SARS’ dramatically improved auditing capabilities mean the exit process is more stringent than ever.

So, taxpayers must ensure they are fully compliant before embarking on it.

Worldwide taxation
Local tax laws require every South African to declare and pay taxes on their worldwide income, even if they moved to another country years ago. SARS does not tax the first R1.25 million of these earning.

However, financial emigration provides a legal escape from this obligation. That said, this method should never be pursued without the guidance of a reputable expatriate tax specialist.

Above all, never try to skip the country without completing this process because SARS can use new international information sharing agreements it has with other jurisdictions to track you down anywhere you go.

SARS’ capabilities
Financial emigration was previously a two-step process involving both SARS and the Reserve Bank. From 1 March 2021, SARS became its sole custodian and its focus has been on ensuring emigrants cannot depart until their taxes are paid-up.

SARS has been investing heavily in technologies like AI and data analytics, as well as integration with third-party databases, like the deeds office and financial institutes. This allows them to compare taxpayer declarations with their actual sources of income, asset holdings and investments.

We’ve begun seeing more in-depth audits that highlight and question disagreements between SARS’ records and those of third parties, and demand that the taxpayer submits explanations with supporting documents as to why these exist.
In addition, SARS used to breeze over trusts. These days, it will request its assets and liabilities statements, list of shareholders and disclosure of any offshore assets it may have.

It is therefore essential that every piece of information submitted to SARS contributes to a true and accurate record of the taxpayer's position as a whole.

Threats
With SARS’ enhanced auditing and data gathering capabilities, emigrants face threats that could delay and even abort their plans for a new life.

First, anyone whose tax affairs are not in order will be exposed. It is imperative that they review their compliance in advance and resolve issues before applying for clearance.

Previously, those who were wilfully non-compliant in their tax submissions could be prosecuted. A change to law in January 2021 now allows SARS to similarly charge those who are non-compliant simply because of negligence.

A taxpayer who cannot explain each and every discrepancy in their exit audit may therefore find themselves in court. Further, if they do not respond to SARS’ request for additional information when applying for clearance, they can be charged for wilful non-compliance as well.

Future uncertain
A rocky exit process is best avoided as it can derail relocation plans that are typically time-sensitive. Keeping an overseas employer waiting while you sort out your taxes leaves a poor first impression. A delayed departure can run up costs like temporary accommodation, storage of household assets and cancelled flights. Worst of all, prosecution resulting in a criminal record could make a once welcoming destination near impossible to set foot in.

Becoming compliant by addressing any past indiscretions and settling outstanding taxes is always preferable to seeing one's dreams disappear on the horizon. It's also the outcome favoured most by SARS.

Advice
Financial emigration remains the cleanest and only legal way to relocate abroad permanently without future tax obligations, but it’s a complex journey, even for the compliant taxpayer.

While any tax consultant can complete your annual returns for you, it's best not to take chances when emigrating. There are too many fly-by-night operators who won't stick around long enough to share your regret when you receive an unexpected SARS audit notice years from now.

Always approach an experienced advisor that specialises in expatriate tax and offers a strong legal component. In other words, they are backed by in-house tax attorneys who will represent you in court if the need arises.

Under no circumstances hide information about your income, assets or investments from your expatriate tax advisor. SARS will come across it when you make your application so, at the end of the day, you are only doing yourself a disservice.

With all your information at their disposal, your advisor will be in a better position to help you. They can offer comprehensive planning and determine the best options for your needs.

It may just be a piece of paper but a tax clearance certificate is the real ticket out of South Africa. And the only way to buy one is to be fully tax compliant.

ENDS

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Tax Consulting SA:
Tax Consulting SA offers a streamlined service in the calculation and filing of individual income tax returns, provisional income tax returns or any other more complex individual tax relate matters. Our highly qualified team of Tax practitioners are registered with SARS under controlling body of the South African Institute of Tax Practitioners (SAIT). As tax specialists, we remove the burden from clients to keep their tax affairs in good order, achieving optimal tax savings while ensuring full compliance.

For more information on Tax Consulting please visit:
Website:  http://www.taxconsulting.co.za
LinkedIn: Tax Consulting South Africa
Facebook: Tax Consulting South Africa

Xpatweb has released its 2020/21 Critical Skills Survey Report. “The report data is most used by stakeholders who influence policies around critical skills and the import of foreign professionals,” says Marisa Jacobs, the firm’s MD.

The Top 10
Survey participants indicated the following skills as most in demand but hardest to source locally: engineers (18%); ICT specialists (13%); foreign language speakers (10%); media and marketing specialists (9%); artisans (8%); C-suite executives (7%); senior financial executives (6%); healthcare specialists (5%); science professionals (4%); accounting professionals (1%).

Of note is the increasing urgency for media and marketing specialists, which Jacobs says is probably due to digital advances, the social media marketing explosion, and the growing sophistication of the marketing profession itself.

Respondents are also concerned that the exclusion of Corporate General Manager from the National Critical Skills List will impact their search for executives with international experience. “We anticipated the term would be replaced with specific titles, like CEO or CFO, to avoid abuse but, so far, this does not appear to be the case,” says Jacobs.

Even if their title does not appear on the Critical Skills List, organisations can still bring in foreign executives. Yet, the process involved is much longer and may cause C-suite candidates to favour offers in other regions where painless migration is assured.

Business impact
77% of organisations reported that they struggle to source critical skills in South Africa for local and cross-border operations. 76% asserted that an international search will help them satisfy their objectives.

92% indicated that missing critical skills have an impact on stakeholders within their organisation. The gaps are typically associated with the top ten critical skills above.

Skills transfer and succession planning
South African employers are sometimes accused of overlooking local talent in favour of foreign professionals. However, 81% of respondents view succession planning and skills transfer as a priority for their business.

“Many organisations have exited their foreign nationals after successfully transferring their competencies and responsibilities to local employees,” reports Jacobs. Unfortunately, the demand typically outstrips the pace of transfer.

Experience and education
Although demand is high, employers cannot risk the integrity of their operations by hiring inexperienced employees. 38 percent require three to five years experience while 28 percent demand over five years.
Similarly, 49% seek an undergraduate degree and 23% desire a postgraduate or honours degree.

Professional bodies
Foreign employees entering South Africa on a critical skills visa must first be registered with a local professional body representing their industry. 21% of respondents find the registration process of professional bodies onerous when applying for such a visa.

“While many bodies enable the efficient entry of foreign talent, others need to review their requirements and processes to ease entry while maintaining their professional standards,” suggests Jacobs.

Valuable data
Xpatweb was the only private sector organisation invited to present its 2019 survey findings before  the Departments compiling the new National Critical Skills List.

“We believe this speaks to the quality of our data, the integrity of our research methodology and the utility of the survey report,” says Jacobs.

The Xpatweb 2020/21 Critical Skills Survey Report is freely available for download from the company’s website, after registration.

ENDS


MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.

For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook:https://www.facebook.com/xpatweb/

Xpatweb’s Critical Skills Survey 2020/21 highlights the most in demand scarce skills the country is facing, which has led to businesses seeking to recruit talent from across the globe.

Xpatweb’s annual survey has fast become known as a benchmark for business and policy makers. Input from the 2019 research findings was submitted for consideration when the drafting the latest OIHD critical skills shortage list.

The survey was conducted across a wide range of multi-national and corporate firms to assess the level of difficulty organisations face when sourcing scarce skilled individuals and the role of foreign nationals in addressing these shortages.

​The number of respondents has grown exponentially in recent years, with a 30% increase in responses from 178 in 2019, to 220 in 2020/21.

Xpatweb managing director Marisa Jacobs highlighted the results of the latest Xpatweb Critical Skills Survey 2020/21.

“The survey has revealed that 77% of organisations have stated that they are still struggling to recruit and obtain critical skills in South Africa for their local and cross-border operations. 76% of participants further confirmed that an international search will assist the organisation in meeting its business objectives,” Jacobs said.

Top 10 most in demand skills
According to the latest survey, the top ten skills businesses are struggling to recruit include Engineers (18%), ICT (13%); Foreign language speakers (10%); Media and Marketing Specialists (9%); Artisans (8%); C-Suite Executives (7%); Senior Financial Executives (6%); Health Professions and Related Clinical Sciences (5%); Science Professionals (4%) and Accounting (1%).

Over the past five years, the skills shortage has persisted with eight categories of skills dominating the top of the list of professionals that businesses find difficult to recruit.

“This has led to many organisations seeking suitably qualified and experienced candidates beyond South Africa’s borders to fill these posts” Jacobs said.

ICT professionals and Engineers in highest demand
The number of businesses indicating that engineers are difficult to recruit rose from 16% to 18% which could indicate that these skills are being lost to the brain drain as countries like Australia and the United Kingdom compete directly with South Africa for qualified and experienced professionals. Business expansions into Africa for special projects locally in the oil and gas sectors also tend to attract these in demand skills.

Mechanical engineers (26%) were most in demand, followed by maintenance engineers (18%), chemical engineers (13%) and industrial engineers (14%).

The demand for ICT skills remains unprecedented and, on the rise, as 14% of businesses, compared to 15% of respondents in the 2019 survey now indicate that they struggle to source skilled professionals in this field to drive their operational demand to transition into the digital economy.

Professionals most sought after included IT application developers (11%), data analysts (10%), data scientists (9%), software developers (9%) and software engineers (8%).

“As big data, robotics, artificial intelligence, machine learning and the internet of things rapidly shape the way of doing business, which often marks the difference between firms that survive and thrive in the transition from the third industrial revolution into the 4IR and those that don’t compete effectively, sourcing these skills is a priority that cuts across all sectors,” Jacobs noted.

Cross border trade growth spurs demand for C-Suit executives and foreign language speakers
Senior Financial and C-Suite Executives remain in demand with the number organisations reporting that it is a struggle to find suitable candidates to fill these key business leadership positions.

Most in demand professions were Chief Operating Officer (24%), Chief Financial Officer (24%), Chief Executive Officer (19%) and Chief Technology Officer (19%).

These skills are most sought after in sectors including business and finance; production and manufacturing; management; information communication; IT and technical services, mining and administrative services.

“Factors influencing the challenges that businesses face in recruiting the right person for these roles include the fact that in a global village, organisations are increasingly seeking professionals with international experience. Businesses are not only seeking essential tick box qualifications and experience required for a traditional executive position, but they want professionals who are equipped with niche business experience to lead their expansion and growth across international markets,” Jacobs explained

“Businesses are aware of market dynamics in their various global markets and need to be certain that candidates understand the nuances of their specific focus areas,” Jacobs added.

This global expansion of businesses and especially growth in cross-border trade on the African continent has also led to rising demand for foreign language skilled professionals, including the hiring of interpreters.

Some 10% of organisations indicated that they struggle to find people with adequate foreign language skills, a marked increase from just 4% in the 2019 survey.

Foreign language speakers most in demand included, French (29%), German (18%), Mandarin (14%); Italian (10%), Spanish (10%) and Dutch (4%). Sectors that are finding a demand for these skills are largely information technology and communication; business and finance; hospitality and tourism and education and libraries.

Global competition for skills
The survey findings reveal that South Africa continues to compete on a global stage for critical skills.
The United States, Australia, and the United Kingdom’s critical skills shortage lists virtually mirror the skills that SA is desperate to attracted as highlighted in the 2020/21 Critical Skills survey - from ICT and C-Suite Executives to Engineers, the country’s need to fill posts in these fields to grow their economies.

“SA has to compete more than ever with the likes of the US, Australia and the UK when considering its strategy to recruit skilled professionals. SA policy makers therefore need to consider how to make it as easy as possible for skilled professionals to gain access to work and business opportunities locally,” Jacobs advised.

“Fortunately, the SA government is serious about this and has updated the critical skills list to stay in touch with the needs of the local economy. The critical skills list makes it possible for businesses to embark on recruitment drives to source these skilled professionals abroad which makes it important for organisations to take advantage of the opportunity to comment on the new list before the deadline,” Jacobs concluded.

Many of the skills on this new survey echo the new Occupation in High Demand (OIHD) list which served as the basis for the updated Critical Skills List (CSL) released Minister of the Department of Home Affairs, Dr Aaron Motsoaledi last month for public comment by 31 March 2021. The CSL represents the latest list of skills deemed in short supply in SA and who may apply for a work visa in terms of the Critical Skills Visa category under the Immigration Act.

For access to the full 2020/21 Critical skills survey results, please visit www.xpatweb.com.
​
ENDS
 
MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.

For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook:https://www.facebook.com/xpatweb/

Authored by: Jean Du Toit, Head of Tax Technical at Tax Consulting South Africa 

SARS has taken a critical step in rebuilding the revenue authority by launching a massive recruitment drive. SARS is looking to appoint 370 experienced and highly skilled individuals, as well as 200 legal, accounting and other graduates in the fields of tax, customs and auditing.

These additional resources will enable SARS to fulfil its promise to crack down on the wealthy and to criminally prosecute delinquent taxpayers.

Words into action
This announcement marks two years to the day since National Treasury announced that Mr Kieswetter will take over the reins at SARS on 1 May 2019. Since then, we have heard of several initiatives to rebuild SARS, specifically directed at enforcement.

But the elephant in the room has always been SARS’ ability to follow through on its strategic objectives, given its capacity issues. However, with an additional budget of R3 billion, SARS has taken a critical step in achieving its objectives; a drive to replenish the resources lost under the previous administration.  With this move we can now expect to see SARS’ initiatives being implemented.

Wealthy taxpayers no. 1 on SARS’ list
The Minister of Finance made it clear as day that enforcement among wealthy taxpayers will be central to SARS’ strategy in coming months. It is reported that several individuals have already been identified for investigation and will receive notices in April 2021.  Those who remain sceptical about SARS’ ability to do so should have a closer look at the recruitment list.

Among the experienced hires, SARS is looking to employ a Director of High Net Worth Individuals, who will be complimented by specialist investigative auditors that will be appointed to focus on this segment of the tax base.

The once far off idea of lifestyle audits, detection of offshore assets and the untangling of complex trust structures is now a reality. The window of opportunity for these individuals to apply for voluntary disclosure relief (VDP) is closing rapidly.

Criminal prosecution
More importantly, the recruitment list has a strong message for the entire tax base – the appointment of criminal investigators. Most should know by now that the bar for criminal prosecution of tax offences has been lowered.

SARS and the NPA pushed for this law change specifically because they found it too difficult to prosecute taxpayers for minor tax offences. With the promulgation of the tax Bills in January, SARS and the NPA no longer need to prove that you had the intention to be non-compliant; you can be held criminally liable if you negligently fail to meet your tax obligations.

The transgressions that could mean a potential prison sentence include failing to update your registered details, not responding to requests for information and not retaining documentary records.

The recruitment list reveals, unsurprisingly, that SARS intends to make use of this law change, to enhance its deterrence factor.

The higher purpose
The recruitment release, titled “SARS – A future reimagined”, on the one hand sends a very positive message to taxpayers – government is committed to restore SARS to the revered institution it once was, where SARS officials were motivated by SARS’ “higher purpose” to serve the people, a mantra instilled by the first Commissioner for SARS, Mr Pravin Gordhan.

On the other hand, it serves as a cautionary notice to those who have succumbed to the decline in taxpayer morality – non-compliance will no longer go undetected, and it will be costly. If you have treated SARS with contempt you should perhaps see this announcement as their final warning to speak to them via the VDP, before they speak to you.

ENDS 

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Tax Consulting SA:
Tax Consulting SA offers a streamlined service in the calculation and filing of individual income tax returns, provisional income tax returns or any other more complex individual tax relate matters. Our highly qualified team of Tax practitioners are registered with SARS under controlling body of the South African Institute of Tax Practitioners (SAIT). As tax specialists, we remove the burden from clients to keep their tax affairs in good order, achieving optimal tax savings while ensuring full compliance.
​
For more information on Tax Consulting please visit:
Website:  http://www.taxconsulting.co.za/
LinkedIn: Tax Consulting South Africa
Facebook:Tax Consulting South Africa
​

The process of financial emigration, which is the process that allows a taxpayer to formally place themselves on record as a non-resident for tax purposes with the South African Revenue Service (SARS), recently changed and came into effect on 1 March 2021.

​Jonty Leon, Legal Manager (Expatriate Tax) at Tax Consulting South Africa, says the company has seen an increased volume of inquiries regarding the benefits of financial emigration, the new process, as well as the timelines involved in financial emigration.

“The advantage of financial emigration is that it allows you to cleanly cease tax residency of SA, ensuring your foreign income and foreign assets are ring-fenced outside of SARS’ jurisdiction. Financial emigration used to be a tax and exchange control process, but the new process means that financial emigration has become solely a tax process.

The exchange control process created an additional set of administrative challenges with financial institutions, which is no longer the case. Under the new financial emigration regime, there are no disadvantages for those who intend to reside outside of the country permanently,” says Leon.

In-depth audits and proving non-residency
As SARS will no longer be able to tax an individual on their worldwide income and assets once they have ceased tax residency of SA, the institution has ramped up its collection power to ensure the taxpayer has truly met the requirements to cease tax residency. This translates to more in-depth audits from SARS to ensure these taxpayers meet the criteria of non-residency.

“For many years, South Africans abroad have flown under the radar. Many expats are still of the opinion that they are no longer liable to pay tax in South Africa if they have been abroad for many years. It is important to note that the process is not automatic, and the burden of proof always lies with the taxpayer. SARS now has a team dedicated to investigating and recovering tax from South Africans abroad who have not ceased their tax residency in South Africa,” says Leon.

Steps involved in financial emigration
The individual seeking financial emigration must be entirely up to date and compliant with SARS. This compliance extends to any South African trusts or companies that they are linked to, which must also be fully up to date and compliant.

The taxpayer must then pass two tests to determine tax residency outside of South Africa, namely the Physical Presence test and the Ordinarily Resident test.

After this, they can submit an application with full supporting documentation to SARS for an Emigration Tax Clearance Certificate. The application will include an “exit tax” that is calculated on certain worldwide assets as well as a declaration of all South African assets and liabilities. Only once this has been audited and approved by SARS can the taxpayer consider themselves a non-resident for tax purposes.

Leon concludes by advising people to partner with a reputable tax advisory firm with experienced, admitted attorneys in their team. “Taxpayers must follow the most transparent, formal route to financially emigrate to ensure a taxpayer can overcome their burden of proof when ceasing tax residency.”

ENDS

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Tax Consulting SA:
Tax Consulting SA offers a streamlined service in the calculation and filing of individual income tax returns, provisional income tax returns or any other more complex individual tax relate matters. Our highly qualified team of Tax practitioners are registered with SARS under controlling body of the South African Institute of Tax Practitioners (SAIT). As tax specialists, we remove the burden from clients to keep their tax affairs in good order, achieving optimal tax savings while ensuring full compliance.

For more information on Tax Consulting please visit:
Website:  http://www.taxconsulting.co.za/
LinkedIn: Tax Consulting South Africa
Facebook:Tax Consulting South Africa

Employers whose business depends on imported engineering skills must submit their comments on the new draft Critical Skills List no later than 16h00 on 31st March 2021.

So says Marisa Jacobs, MD of Xpatweb, the only private company invited to participate in the development of the proposed List.

“Holders of critical skills visas based on the previous CSL will be unable to renew them if their skill is discarded from the new list, and their organisations will be required to follow are more lightly visa process where the resource is required beyond their current visa validity period,” she says.

“The Covid pandemic has in a number of cases impacted projects which will mean that resources may be required beyond the initial assignment period,” Jacobs adds. 

While certain engineering roles appear on the list, others in high demand have not been included.

Scarce engineering skills
Industry experts agree that various engineering skills are in short supply locally, often in specialised fields.

Sumaya Hoosen, Human Capital & Skills Development Executive at the Steel and Engineering Industries Federation of Southern Africa (SEIFSA), says absent from the List are mechanical and electrical design engineers, quality systems engineers, robotics and production engineers, and production and process control engineers and technologists.

“At an intermediate level, specialist technicians across several disciplines remain in short or critically scarce supply,” she says. These include lift; heating, ventilation and air conditioning, and generator repairs; non-destructive testing; and process control technicians, as well as additive manufacturing technologists, environmental specialists, and supply and distribution specialists.

Millicent Kabwe, acting Executive: Strategic Services at the Engineering Council of South Africa points out that while the List is generally comprehensive, specialisations cannot be overlooked. “ECSA accreditation clearly states that professionals can only practice in their field of competence,” she says.

Civil engineers, for example, can specialise in roads, traffic and transportation, hydraulics, water and sanitation, structural or geological disciplines. Experts in one area are not considered competent in another.
Kabwe also notes that chemical engineers and refrigeration and air conditioning artisans have been neglected. Interestingly, Xpatweb’s survey data echoes this sentiment showing that 13% of respondents who struggle to recruit engineers, also say that chemical engineers are in high demand.

“The state of the Chemical Industry in South Africa has not shown any significant growth in the last decade,” she says.
In addition, Kabwe says that a number of roles in the automation instrumentation mechatronics field should have been included in the draft List.

“The fact that mechatronics technician was the only mechatronics professional identified shows that the current List is only concerned with maintaining equipment from international suppliers and not developing new technologies,” she observes.

Hoosen agrees. “The List is not progressive enough to regard technological developments in the industry,” she says.
Xpatweb’s latest survey reveals that shortages occur predominantly in production and manufacturing, architecture, mining, education and libraries, and healthcare. In these arenas, the specific engineering roles were mechanical, maintenance, chemical, mining, industrial, nuclear and automation engineers.

“Preliminary results show that 18% of participants struggle to recruit engineers,” reports Jacobs. At the same time, 97% of respondents with an engineering skills shortage indicate that ongoing access to these skills is vital to their business’s continued operational success.

Education and experience
Although engineering graduates are available in South Africa, employers seek both good education and ample experience to protect the integrity of their projects.

Xpatweb’s survey data shows that 40% of respondents require their engineers to hold an advanced diploma-level education, whereas 12% demand a Master’s degree.

13% require one to three years experience, 37% want three to five years experience, and 46% need five years or more experience.

Succession planning and skills transfer
Encouragingly, 81% of survey participants indicated that using expatriate professionals to facilitate succession planning and skills transfer is a top priority for their business.

“Companies actually prefer local engineers but need employees with the right experience,” says Jacobs. “Hiring expatriates provides mentoring opportunities while meeting that condition.”

Hoosen states that the most important benefit of hiring foreign engineers needs to be in the development of local competence and expertise in these much needed disciplines.

Kabwe believes that the transfer of skills and knowledge to the country will lead to increased innovation, as well as other economic advantages, like keeping talent, business and taxes inside South Africa.

Taking action
With only a few days left to make their needs heard, Jacobs urges employers to submit their comments on the draft Critical Skills List.

“After the deadline, the chances of recruiting foreign engineering roles not on the finalised List will drop dramatically,” she warns.
​
Jacobs also encourages employers to take Xpatweb’s Critical Skills Survey. “The fact that our data was used in developing the draft CSL is a testament to the quality of our research methodology, which promises invaluable insights to expatriate employers,” she says.

ENDS

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.

For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook:https://www.facebook.com/xpatweb/

According to Marisa Jacobs, Managing Director of Xpatweb, certain artisan skills have been left off the recently gazetted draft Critical Skills List.

“This should be cause for concern for affected organisations and we encourage them to review the list urgently,” she says.

The Department of Home Affairs called for public comment in the gazette and employers have until 16h00 on 31 March 2021 to submit their suggestions.

Which artisans?
Dr Innocent Sirovha, CEO of the Agricultural Sector Education and Training Authority (AgriSETA), says all necessary critical and scarce skills have been included on the draft List.

However, Sumaya Hoosen, Human Capital & Skills Development Executive at the Steel and Engineering Industries Federation of Southern Africa (SEIFSA), confirms that several import skills have been omitted. “In the artisan field, boilermakers and millwrights are in short supply,” he says.

Referring to Xpatweb’s own Critical Skills Survey, Jacobs points to the artisan skills that respondents indicated as scarce but essential to their operations. They include millwright, electrician, fitter and turner, instrumentation specialist artisan, automation specialist, and refrigeration and air-conditioning mechanic. “Of these, only fitter and turner is included in the draft List,” she says.

Preliminary results from the firm’s latest survey show that 7 percent of employers struggle to recruit such artisans. They operate predominantly in the mining, construction, and production and manufacturing industries.

Education and experience
An interesting note from the Department of Higher Education and Training’s full technical report explains why mechanical fitter, electrician and millwright, although critical, were discarded from the list.

It says that these occupations “were described as having a large number of qualified yet unemployed South African citizens who were not finding job placements. For this reason, there is sufficient evidence to exclude these occupations from the finalised CSL.”

Although this is true, employers need artisans with a level of education and experience not easily sourced locally.

66 percent of respondents to Xpatweb’s survey seek diploma level education or higher. In terms of experience, 23 percent require a minimum of one year experience, 30 percent require three to five years experience and a massive 43 percent require five or more years experience.

Encouraging feedback, 81% of these employers reported that succession planning and the transfer of foreign skills to local artisans is a high priority for their business.

“Employers indeed want local artisans but they need good experience to ensure project integrity is maintained,” says Jacobs.

Expiring visas
Jacobs also points out that certain foreign artisans currently in South Africa under a critical skills visa will not be able to renew that visa when it expires if their skill is not on the finalised List.

This means their employers could possibly lose an essential resource for their business where they are not able to sufficiently motivate for a visa renewal, which in turn means they will also have to go through a lengthy process to replace them.

“Importing skills not on the CSL takes several months longer and for some employers, this can impact their operations significantly,” says Jacobs.

This is yet another reason why they should submit their comments before the quickly approaching deadline.

Jacobs also urges employers to participate in Xpatweb’s Critical Skills Survey, which was the only private sector data used as input for the Critical Skills List. “Employers can benefit immensely from the industry-wide insights our results provide and their influence on initiatives like the CSL,” she concludes.

ENDS

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.

For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook:https://www.facebook.com/xpatweb/

In July last year, the UK government announced that it would be launching a special visa for Health and Social Care workers to apply to work in the UK. This included, amongst other things, faster visa turn-around times, reduced visa fees compared to that paid by other skilled applicants and exemption from the Immigration Health Surcharge.

This, according to the Home Secretary, Piri Patel, is in an effort to attract the ‘’best and brightest heath and care professionals’’ globally to work and help strengthen the National Health Service (NHS).

Skills shortage in SA
South Africa is experiencing a mass exodus of healthcare professionals who look for greener pastures after graduating.  In addition, 48% of practising nurses in South Africa are due to reach retirement age in the next 15 years, with not nearly enough in training to fill the shortfall.

Attracting skills and investment
Marisa Jacobs, Managing Director at Xpatweb, notes that while we have the Critical Skills list that includes skills in high demand in South Africa, there is certainly a spotlight being placed on the Legislation used to attract skills and South Africa should be open to considering similar visa options to attract skilled workers and investors alike to strengthen the labour sector and economy.

Some examples include

1. Residency by Investment options;
2. Special Dispensations for specific skills (similar to UK Health Care Worker visa above); and
3. Remote Worker Visas (similar to Mauritius and Portugal Nomad Visas).

All these options are aimed at attracting only the top skilled labour, injecting the economy through tourism and travel, and inciting investors.

Enabling legislation
The pandemic has certainly highlighted various shortcomings across sectors, but it has also shown that nations on the continent and around the world can stand together in times of need. Policy and regulations enable growth and skills development in significant ways but only where we invite debate, comment positively and with insight on draft legislation and make our voices heard.

Xpatweb annually conducts the critical skills survey to gather feedback from employers to establish which skills should be included in the Critical Skills list. The survey data will be instrumental in commentary on the latest draft list currently open for public comment until 31 March 2021.

This is the perfect platform for employers and all South Africans alike to provide valuable inputs to the Department of Home Affairs on how to optimally leverage the list to attract skills to South Africa to strengthen the economy and local labour force for generations to come. 

ENDS

MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za

ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.

For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook:https://www.facebook.com/xpatweb/

The Department of Home Affairs is currently calling for public comment on the draft of a new Critical Skills List. However, Foreign Language Speakers, a role that featured in the previous List, has been omitted from the draft List.
 
“Foreign language employees are more valuable than the language they speak and are critical to job creation inside South Africa’s borders,” says Marisa Jacobs, Managing Director at Xpatweb.
This skill appears high on the company’s Critical Skills Survey results, which were used as input for the draft List.
 
Export industry
Mary-Ann McCormick, HR Director at Indian Ocean Export Company (IOEC), says foreign language workers are essential to cementing strong business relationships in the firm’s French-speaking market abroad.
 
The company’s business development managers and export coordinators must be fluent in the language to a degree not found in South Africa. “If we are able to source them, they usually don’t have the skillset or experience we demand for the quality of service we must deliver,” she says.
 
Foreign language workers not only communicate complex information fluently but bring with them international experience and an understanding of the unique traits and expectations of IOEC’s target market.
 
McCormick reports that the company previously tried outsourcing these functions to agents in the destination regions but assuring service quality from a distance proved impossible. “For our model to work, our business development managers and export coordinators must be located in-house,” she says.
 
Contact centres
Organisations outsourcing their foreign market support function to contact centre operators typically insist that high quality foreign language consultants be available to their customers.
 
Contact centre services include telephone, chat and email support, as well as website translation and marketing programmes aimed at nominated countries.
 
“These activities require in-depth knowledge of the specific country, its customs, traditions, preferences, nuances and more,” says Sharon Haigh, CEO of Contact Centre Management Group (CCMG), a professional body representing over 2,000 South African contact centres. “Merely being able to speak the language without this knowledge has proven insufficient for our members’ needs,” she says.
 
According to Haigh, the 10 to 15 percent of foreign speakers typically employed at local contact centres ensures those companies can provide jobs to the 85 percent of local workers who support them. In addition, South Africa has been voted the world’s second most attractive BPO destination for three years running. It can improve this standing by focusing on authentic foreign language support.
 
 
Tourism
Few South African business leaders missed Finance Minister Mboweni’s 2021 budget speech in which he called for a focus on job-creating sectors, specifically naming tourism.
 
However, leaders in the tourism field have long complained that a lack of competent foreign language speakers is hurting the industry, especially during peak season. Travellers with money to spend would rather frequent regions where their native tongue is represented.


The Department of Tourism has acknowledged this need by offering a two-month course in Mandarin to local tour guides. However, one cannot learn a language effectively in two months and guides make up a small part of the overall business and marketing drive to attract tourists in the first place.
 
Jacobs agrees: “Tourism is a major contributor to the South African economy and native foreign language speakers are strongly linked to growth in that sector.” She adds that preliminary results from Xpatweb’s 2020/21 Critical Skills Survey reveal a significant increase in demand for this role among participants, jumping from 6 percent last year to 16 percent in 2021.
 
Critical Skills Survey
Xpatweb has carried out its Critical Skills Survey for the past 5 years, providing reliable data on the needs of South African businesses. As a result, it was the only private sector organisation invited to present its findings before the Departments involved in compiling the draft List. This demonstrates the quality of its data and research methodology.
 
Jacobs encourages organisations who rely on foreign language speakers for the sustainability and growth of their business to comment on the draft List before 16h00 on 31 March 2021.
 
“If they don’t, they will have to wait several months longer before an employee critical to their operations can be onboarded due to visa application restrictions,” she warns.
 
Jacobs also invites these employers to complete the current Critical Skills Survey, which is more in-depth than previously. Doing so will ensure their needs are presented to regulators long before the next public comment process is announced.

ENDS
 
MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za
 
ABOUT Xpatweb:
HOLISTIC EXPATRIATE SOLUTIONS
The Xpatweb group has been in existence for over 15 years and includes over 100 professionals, including immigration specialists, mobility practitioners, tax practitioners, attorneys, and chartered accountants. They offer holistic, client-centric, and fully compliant expatriate and work visa solutions. Clients can expect an exceptional end-to-end service that starts with an initial technical meeting to discuss any past challenges, a recommended optimal solution, and the creation of a roadmap and protocol for service delivery. They also offer an on-premises immigration audit service to confirm expatriate employees hold legally obtained, valid visas, and that their duties align with their visa conditions. In addition, their unique online immigration tracking system helps you to easily manage and track expatriate assignees across the globe, is fully customisable and dashboard-driven, and provides a secure repository for storing assignees’ documents.
 
For more information on Xpatweb please visit:
Website:  http://www.xpatweb.com/
LinkedIn: https://www.linkedin.com/company/work-permit-south-africa/
Facebook: https://www.facebook.com/xpatweb/

Authored by: Thomas Lobban, Legal Manager, Cross-Border Taxation at Tax Consulting South Africa
 
There are many South Africans who have made investments into cryptocurrency, and we see all types of traders and investors on a daily basis. It has announced a new dawn of investment world-wide and regulators world-wide have been sluggish to respond. However, it is now firmly on the tax radar for revenue authorities world-wide; and the position of SARS seems to be no different.
 
The walls are closing in on crypto traders
In the 2021 Budget Speech, Minister Tito Mboweni announced that SARS will be provided with an additional allocation of R3 billion to “modernise its technology infrastructure and systems, expand and improve the use of data analytics and artificial intelligence capabilities, and participate meaningfully in global tax compliance initiatives”.
 
In addition to audit letters recently sent to taxpayers enquiring about their cryptocurrency-related holdings and activities, the Commissioner of SARS, Edward Kieswetter, has further stated following the 2021 Budget Speech that “[u]ndisclosed offshore assets, including crypto-assets such as bitcoin, will be a big area of focus.”
 
SARS seems to be looking at cryptocurrency as an area of additional tax revenue, and with the ability to raise 100% penalties and strengthening of criminal offenses provisions where an innocent mistake can now give you a criminal record, the law is very much in SARS’ corner. Now, the infrastructure is already being put in place to ensure that the shortfalls of SARS’ current information-gathering and tax revenue collection mechanisms are systematically closed.
 
SARS has already included questions concerning cryptocurrency in the capital gains tax portion of tax returns, and have further created source codes for cryptocurrency-trading profits (​2572) and losses (2573) respectively. This means that there is no room for a taxpayer to manoeuvre in light of non-disclosure in their returns.
 
United States Example – Are They Smarter?
The much feared Internal Revenue Service (IRS) has similarly embarked on a drive to bring previously undisclosed cryptocurrency amounts into their tax net. However, compared to SARS, it appears that the IRS is taking a much more robust approach, as no one messes with the IRS.
 
The United States have strategically placed the question about cryptocurrency holdings on page one of their tax returns (known as a 1040, which makes for a joint tax filing by a family). All United States citizens and green card holders are thus forced to answer accurately, eliminating any defences later.
 
Their question reads whether the relevant taxpayer did, at any time in the tax year, “receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency”.
 
This means that, regardless of whether or not and how cryptocurrency was acquired by the taxpayer, they are expected to disclose this to the IRS. In 2019, more than 10 000 letters were sent to taxpayers who had carried out crypto transactions and who may have failed to report their income and pay the tax owed.
 
In South Africa, it seems better late than never for SARS, who are only recently engaging in their cryptocurrency compliance and enforcement project. Nevertheless, this does not mean that taxpayers should expect any leniency from SARS for incorrectly or undisclosed cryptocurrency transactions. SARS is increasingly being forced into a space where it must drop its soft gloves approach in helping taxpayers being compliant and putting up billboards about how good taxes are for the country. They now have the additional R3 billion allocated towards SARS for this purpose, and it appears that they have been given 3,000 million to go out and collect even more.
 
Full disclosure to mitigate exposure
Contrary to what many traders and investors believe, cryptocurrency can be tracked and traced with the correct expertise and resources. This may be through direct questions posed by SARS to a taxpayer in terms of an audit letter, or by way of more indirect questions (e.g., asking questions with reference to outbound money transfers by the taxpayer and withdrawals from known cryptocurrency platforms). Remember, technology does not forget and once you have clicked on even a cryptocurrency ad, your digital footprint is already there.
 
Taxpayers need to understand the tax treatment applicable to cryptocurrency trading ahead of time and take the necessary steps to ensure they are able to meet their obligations. If taxpayers have already been trading in cryptocurrency and have not given the tax consequences much thought, it may be wise to seriously start considering the regularisation of their affairs with SARS.
 
Recent changes to our tax laws in South Africa mean that SARS no longer has to prove that someone had an intention to commit a criminal tax offence. Instead, only negligence on the part of the taxpayer needs to be proved. Upon conviction, a taxpayer may be fined or sentenced to up to two years in prison and, if found to have attempted tax evasion or to obtain an undue refund, this may result in them spending up to five years in prison.
 
It is clear that cryptocurrency remains a key concern for revenue authorities and the issue will not be going away any time soon. As SARS continues to evolve its infrastructure to clamp down on non-compliance in relation to cryptocurrency, taxpayers need to be mindful of their obligations and render unto Caesar what is due or face the consequences of continued non-compliance.

ENDS

 
MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za
 
ABOUT Tax Consulting SA:
Tax Consulting SA offers a streamlined service in the calculation and filing of individual income tax returns, provisional income tax returns or any other more complex individual tax relate matters. Our highly qualified team of Tax practitioners are registered with SARS under controlling body of the South African Institute of Tax Practitioners (SAIT). As tax specialists, we remove the burden from clients to keep their tax affairs in good order, achieving optimal tax savings while ensuring full compliance.
 
For more information on Tax Consulting please visit:
Website:  http://www.taxconsulting.co.za/
LinkedIn: Tax Consulting South Africa
Facebook: Tax Consulting South Africa