South African companies are increasingly sending employees abroad — whether for projects, secondments, or permanent relocation. But when it comes to paying those employees, many employers quickly discover the rules aren’t straightforward.

The key issue? Residency status.

Why residency status matters

From an exchange control perspective, there’s a big difference between:

1. Employees temporarily abroad (still residents):
   
   • Their salary is still considered South African income.
   • Employers typically pay them in rand into a South African bank account.
   • If the employee wants to move funds overseas, they must use their personal allowances:
     
     • R1 million per year under the Single Discretionary Allowance (no clearance needed).
     • Up to R10 million under the Foreign Investment Allowance (requires SARS tax clearance).
   • Employers can assist, but the transfer still counts against the employee’s limits.
     
     

1. Employees who have ceased residency (non-residents):

1. • Once SARS confirms their non-resident status, they can be paid directly into a foreign account.
   • No reliance on allowances, no rand account required.
   • Employers simply need to provide proof of non-residency to their authorised dealer (bank) to ensure correct processing.

The tax angle

Exchange control is the main driver, but tax matters too.

• Residents abroad: still subject to PAYE, though foreign income exemptions (up to R1.25m) may apply.
• Non-residents: only taxed on South African-sourced income. If their work is entirely abroad, no PAYE applies.

Employers must therefore align exchange control compliance with tax obligations to stay on the right side of the law.

Where companies get stuck

For many businesses, managing this process internally creates risk. Misclassify an employee, apply the wrong allowance, or fail to provide the right documents, and transfers can be delayed — or worse, non-compliant.

How Currency Assist helps

At Currency Assist, we partner with South African companies to simplify international payroll:

• We review employee residency status and ensure the correct structure is applied.
• We liaise with SARS and authorised dealers to prevent compliance issues.
• We set up smooth, repeatable payroll solutions for teams abroad.
• We give finance teams peace of mind by aligning tax and exchange control requirements.

Your next step

If your company employs South Africans abroad, don’t let payroll become a compliance trap.

Contact Currency Assist today and let us set up a compliant, efficient system for paying employees across borders.