Market Taxation Guide - South Africa
This Market Taxation Guide (South Africa) provides the following details:
- Reference information about all taxes applied at source, through Clearstream Banking1 and its local depositories, to securities deposited in Clearstream Banking; and
- Instructions for obtaining relief at source or a refund of withholding tax, where these are available, through Clearstream Banking.
New and improved tax information and procedures that become available will be included on an ongoing basis.
Important note:
This Market Taxation Guide (including any attachments and other links) is for informational purposes only and is not intended and should not be considered to be legal advice on any subject matter. Readers of this Market Taxation Guide, whether customers or otherwise, should not act or refrain from acting on the basis of any information included in this Market Taxation Guide without seeking appropriate legal or other professional advice. Copies of the content (in paper or electronic form) may be delivered to a third party for personal use only.
Withholding tax
No withholding tax is deducted from interest on South African debt securities held in Clearstream Banking.
A withholding tax on equities issued in South Africa (South African Equities and Inward Listed Securities) is applicable to all dividend distributions declared or announced on or after 1 April 2012.
| South African Equities | Holding restriction? | Withholding tax rate | Exemption & Relief at source | Quick refund | Standard refund |
No | 20% a | ||||
Residents of Double Taxation Treaty (DTT) countries | Yes | Yes | Yes | ||
Supranational entities recognised by the South African authorities | Yes | Yes | Yes | ||
| Exempt foreign entities b | Yes | Yes | Yes | ||
South African residents eligible to claim under defined exemption codes | Yes | Yes | Yes | ||
| Inward Listed Securities | Holding restriction? | Withholding tax rate | Exemption & Relief at source | Quick refund | Standard refund |
No | 20% a minus foreign tax rate | ||||
Any non-resident beneficial owner | Yes | Yes | Yes | ||
South African residents eligible to claim under defined exemption codes | Yes | Yes | Yes | ||
a. 15% on income paid before 21 February 2017.
b. Foreign entities exempted from worldwide tax by way of the Diplomatic Immunities and Privileges Act (Act 37/2001) schedules 3 and 4 on the United Nations and its specialised agencies.
Capital gains tax
There is no capital gains tax withheld through Clearstream Banking on securities held in Clearstream Banking. Capital gains tax may however be payable on specific gains. Clearstream Banking does not assist in this regard. Please consult your tax advisor for further information.
Duty on transactions
The following duties may be payable on specific transactions:
Stamp Duty
There is no stamp duty withheld through Clearstream Banking on securities held in Clearstream Banking. Stamp duty may however be payable on specific transactions. Clearstream Banking does not assist in this regard. Please consult your tax advisor for further information.
Securities Transfer Tax (STT)
Transactions in listed or unlisted equities issued in South Africa are, in principle and unless an exemption applies, subject to STT.
No STT is payable on transfers that involve no change of beneficial ownership.
When there is a change of beneficial ownership, STT is paid by the buyer upon purchase of the equities in the market and is imposed, on registration of the transfer, at the rate of 0.25% of the market value of the securities being transferred.
In Clearstream Banking, STT applies by default to all receipts where no exemption is claimed.
To benefit from an exemption, the customer must be sure to input the appropriate values in the Beneficial Owner Indicator and Stamp Duty Status fields of the settlement instruction, as described in the Creation Link Guide - South Africa.
No STT is levied by Clearstream Banking on internal transfers of equities issued in South Africa between Clearstream Banking Luxembourg customers. However, customers, other intermediaries or beneficial owners may, in accordance with the South African STT regulations, be liable and accountable, as buyer/transferee of the securities, for payment of STT on internal transfers. Customers should consult their tax advisers to ensure compliance.
Payment of STT
For external receipts of equities issued in South Africa, the customer’s ZAR account will be debited with STT as soon as the duty has been paid to the South African Tax Authorities, that is, during the month following the month in which the transaction took place.
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1. “Clearstream Banking” refers collectively to Clearstream Banking S.A. and Clearstream Banking AG (for Clearstream Banking AG customers using Creation accounts)