South Africa Court Ruling Clarifies VAT Liability for Seconded Employees

• South Africa’s North Gauteng High Court ruled against Citibank South Africa in a VAT liability case involving seconded employees.
• The judgment clarified the circumstances in which a VAT liability may arise when employees are seconded to South Africa from abroad.
• Citibank argued that the seconded employees became employees of Citibank South Africa under South African law, but SARS disputed this.
• The court found in favor of SARS, stating that Citibank failed to prove it was the employer of the seconded employees and that the amounts paid to the home country entity constituted remuneration.
• The judgment highlights the importance of determining the real employer in cases involving seconded employees to mitigate unnecessary VAT costs.

Source: taxathand.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

---

---