Facilitating international transactions by navigating the complex rules and regulations related to taxes
When businesses expand or invest across the world to pursue growth they are exposed to unfamiliar in-country laws and practices thus needing international tax advisors to navigate the investment cycle, from setting up your new business or structuring an acquisition, managing ongoing tax compliance obligations, to structuring an eventual exit. We advise South African companies embarking on international expansion (outward bound investment) and foreign companies coming to invest in South Africa (inward bound investment). When deals involve companies with global operations, the range of issues to consider is compounded. All transactions raise complex issues regarding potential tax risks and provide opportunities to implement practical strategies to improve tax efficiency and certainty. We assist multinational enterprises in developing a tax structure that fits with your operational structure while taking advantage of advantages and opportunities thereby avoiding double taxation from several countries. We include in the design considerations related to tax residency and taxable presence in each country as these differ based on local tax laws and bilateral tax agreements applicable to the respective countries. Lastly, we assist with managing compliance with the South African Exchange Control regulations applicable to cross border capital movements for both individuals and business entities.
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Outward bound investment: When businesses expand or invest outside of South Africa, they are exposed to unfamiliar in-country tax laws and practices. We assist South African companies wishing to establish operations outside of the country in determining the best investment structure as well as the tax efficiencies to be achieved from the various forms of investment.
Where the target country has a bilateral double tax agreement (“DTA”) with South Africa, we also advise on the application of the treaty to the proposed investment. Where the proposed investment falls outside of the DTA's present stated areas, we seek local guidance on the expected tax treatment. Where the target country does not have a DTA, we advise on the tax treatment and the potential for double taxation as well as mitigation strategies.
Inward bound investment: For foreign companies wanting to expand operations into South Africa or through a South African holding company into the rest of Africa, providing guidance on the form of investment most suitable for their proposed investment. Verifying that the corporate, transactional, and finance components of an investment are in sync with the tax consequences. We advise on the income, withholding and capital gains taxes to note for their South African investments and assets.
Our qualified team emphasises foreign currency and investment reporting issues to be aware of in terms of South African exchange regulations and DTA benefits (where applicable).
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