Working in Cape Town?
Cape Town: Jobs, Social Security, Taxes
The Job Search and Business Contacts
If you are not among those expats who go to Cape Town for an intra-company transfer, your job search will begin where it usually would these days: the Internet. There are countless online job portals for South Africa, many of which also have a local focus on Cape Town, for example, Jobsin Cape Town. Your search engine of choice should produce satisfactory results here.
We’ve already written about the place and importance of existing business contacts for a successful expat career working in South Africa: you can probably do without. In fact, the lack of networking and inter-company contacts is one of the more lamented facts of the business world in Cape Town. Several initiatives have been taken by institutions and communities such as Connect’d to combat this situation.
However, these efforts did not change much in terms of how the job hunt in Cape Town is tackled. In contrast to, for example, the USA, businesses in Cape Town and South Africa in general cannot rely on the slim chance of finding apt personnel solely through the so-called hidden job market. Brain drain continues to be a serious problem, and oftentimes, expats have to be recruited to fill positions, as suitable candidates can be scarce.
Some of the temporary residency permits for expats we have discussed in our article on moving to Cape Town reflect this state of affairs. In a few special cases, you can even enter South Africa and look for work in Cape Town yourself, on location, without having to deal with the — often long-winded — task of looking for work in another country via the Internet. Your personal qualifications and experience are the decisive factors here, as only individuals of particular expertise are granted this advantage.
A Look into the Social Security System
During your time as an expat in Cape Town, you have to make contributions to South Africa’s social security system. These contributions are automatically deducted from your monthly paycheck by your employer.
The South African social security system and its various schemes and programs are predominantly funded by the government and employers. The only program employees contribute to directly is the unemployment fund, and the deductions from their earnings are quite modest: 1% of an employee’s salary, capped at 148.72 ZAR monthly.
With that said, most expats will probably be able to live with the fact that they will not be seeing much of their contributions. None of the temporary residency permits available to expats make you eligible to receive any benefits of the South African social security system. Furthermore, South Africa has only very few social security agreements with other nations. Most probably, you will not receive anything for any contributions you make during your stay in Cape Town.
Paying Taxes as an Expat
As an expat in Cape Town, you will be considered a resident for tax purposes, provided you are physically present in South Africa for at least 91 days in the tax year, which starts on the first of March.
The total sum of taxes you have to pay obviously depends on your salary. The South African Revenue Service distinguishes between six income categories or levels. While the first level, which is income of up to 165,600 ZAR, is taxed on a flat rate of 18%, the other categories are taxed a fixed sum plus a certain percentage of the amount you earn in excess of the lower threshold of your income category.
This might sound a lot more complicated than it actually is. Consider this example: if you earn 400,000 ZAR a year, you are placed firmly in the fourth category, which spans incomes from 393,201 to 550,100 ZAR. The fixed tax sum for this category is 93,135 ZAR for the tax year starting 1 March 2015. In addition to that, you have to pay 35% of the amount your earnings exceed 393,201 ZAR
For a detailed compilation of all tax categories for the current tax year, see the website of YourTax.
We do our best to keep this article up to date. However, we cannot guarantee that the information provided is always current or complete.
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