• 1. Freight tax

Freight tax

Corporate tax: 28% of taxable income, which is considered to be 15% of gross outward freight, and all earnings from coastal operations (= 4.2%).

Exemption Agreements

Residence of the following countries may benefit from double taxation agreements exempting or reducing income tax on outward earnings. The agreements do not allow for exemption on earrings derived from coastal operations.

Comprehensive Double Taxation Agreements  

Country Reduction Date of entry into force Date of effect
Algeria 100% 12/06/2000 01/01/2001
Australia 100% 21/12/1999 01/01/2000
Austria 1a 100% 06/02/1997 01/03/1998
Belarus 100% 29/12/2003 01/01/2004
Belgium 1a 100% 09/10/1998 01/01/1999
Botswana (Renegotiated) 100% 20/04/2004 02/05/2004
Brazil 100% 24/07/2006 01/01/2007
Bulgaria 100% 27/10/2004 01/01/2005
Cameroon 100% 13/07/2017 01/01/2018
Canada 100% 30/04/1997 01/01/1997
 Chile 100%  11/08/2016 01/01/2017
China 2 100% 07/02/2001 01/01/2002
China 1b, 3 100% 12/09/1996 01/11/1996
China 8
100% 20/10/2015 01/01/2016
Congo, Democratic Republic of 100% 18/07/2012 01/01/2013
Croatia 100% 07/11/1997 01/01/1998
Cyprus 100% 08/12/1998 01/01/1999
Czech Republic 100% 03/12/1997 01/03/1998
Denmark 100% 21/12/1995 01/01/1996
Egypt 100% 16/12/1998 01/02/1999
Ethiopia 100% 04/01/2006 01/01/2007
Finland 100% 12/12/1995 01/01/1996
France 1a 100% 01/11/1995 01/01/1996
Germany 100% 28/02/1975  
Ghana 100% 23/04/2007 01/01/2008
Greece 100% 14/02/2003 01/01/2004
Grenada 4 100% See Note  
Hungary 1a 100% 05/05/1996 01/01/1997
India 100% 28/11/1997 01/01/1998
Indonesia 100% 23/11/1998 01/01/1999
Iran 100% 23/11/1998 01/01/1999
Ireland 100% 05/12/1997 01/01/1998
Israel 1a 100% 27/05/1980 01/03/1978
Italy 1a 100% 02/03/1999 01/01/2000
Japan 100% 05/11/1997 01/01/1998
Kenya 50% 19/06/2015 01/01/2016
Korea, Republic of 100% 07/01/1996 01/01/1997
Kuwait 100% 25/04/2006 01/01/2006
Lesotho 1a 100% 09/01/1997 01/01/1998
Luxembourg 100% 08/09/2000 01/01/2001
Malawi 100% 02/09/1971  
Malaysia 100% 17/03/2006 01/01/2007
Malta 100% 12/11/1997 01/01/1998
Mauritius 1a 100% 20/06/1997 01/01/1998
Mauritius (Renegotiated)
100% 28/05/2015 01/01/2016
Mexico 100% 22/07/2010 01/01/2011
Mozambique 100% 19/02/2009 01/01/2010
Namibia 1a 100% 11/04/1999 01/01/2000
The Netherlands (Renegotiated) 100% 28/12/2008 01/01/2009
New Zealand 100% 23/07/2004 01/01/2005
Nigeria 5 100% 05/07/2008 01/01/2009
Norway 100% 12/09/1996 01/01/1997
Oman 100% 29/12/2003 01/01/2004
Pakistan 50% 09/03/1999 01/01/2000
Poland 1a 100% 05/12/1995 01/01/1996
Portugal 100% 22/10/2008 01/01/2009
Qatar
02/12/2015 01/01/2016
Romania 1a 100% 21/10/1995 01/01/1996
Russia 100% 26/06/2000 01/09/2000
Rwanda  100% 03/08/2010
 01/01/2011
Saudi Arabia 1a 100% 01/05/2008 01/01/2009
Seychelles 100% 29/07/2002 01/01/2003
Sierra Leone 4 100% See Note  
Singapore 100% 05/12/1997 01/01/1998
Slovakia 100% 30/06/1999 01/09/1999
Spain 1a  100% 28/12/2007 01/01/2008
Swaziland (Renegotiated) 100% 27/01/2009 01/01/2010
Sweden 100% 25/12/1995 01/01/1996
Switzerland (Renegotiated) 100% 27/01/2009 01/01/2010
Tanzania 6 See Note 15/06/2007 01/08/2007
Thailand 50% 27/08/1996 01/01/1997
Tunisia 1a 100% 10/12/1999 01/01/2000
Turkey 100% 06/12/2006 01/01/2007
Uganda 100% 09/04/2001 01/01/2002
Ukraine 100% 29/12/2004 01/01/2005
United Arab Emirates 100% 23/12/2016 01/01/2017
United Kingdom 7 100% 17/12/2002 01/01/2003
United States 100% 28/12/1997 01/01/1998
Zambia 100% 31/08/1956 13/06/1954
Zimbabwe 100% 03/09/1965 28/02/1964
Comprehensive treaty negotiations currently in progress
Ratified in South Africa
Chile Signed 11/07/2012  
Gabon Signed 22/03/2005  
Germany (Renegotiated) Signed 09/09/2008  
Lesotho (Renegotiated)
Signed 18/09/2014  
Mauritius (Renegotiated) Signed 17/05/2013  
Sudan Signed 07/11/2007  
Signed but not ratified
Zimbabwe (Renegotiated)
Signed 04/08/2015  
In the process of negotiation or finalised but not signed
Argentina (Limited Transport Treaty)
     
Cuba      
Isle of Man (Limited Transport Treaty)      
Malawi (Renegotiated)      
Morocco      
Namibia (Renegotiated)      
Senegal      
Singapore (Renegotiated)      
Sri Lanka      
Syria      
Vietnam      
Zambia (Renegotiated)      

Notes

  1. If the place of effective management of a shipping enterprise is aboard a ship or boat, then it shall be deemed to be situated in the Contracting State

    a. in which the home harbour of the ship or boat is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship or boat is a resident.
    b. of which the operator of the ship or boat is a resident.
  2. This treaty does not apply to residents of Hong Kong, SAR; Macao, SAR or Taiwan, Province of China.
  3. This treaty applies only to residents of Taiwan, Province of China. 
  4. The 1946 Double Taxation agreement with the United Kingdom extended to cover this country.  
  5. 100% exemption, except if it is deemed that only one of the Contracting states is engaged in international traffic with the other. In which case the tax charged shall not exceed 1% of the earnings derived in South Africa.
  6. Profits derived ... from the operation of ships ... in international traffic may be taxed in both Contracting States according to the law of each Contracting State....

    a.such profits shall be deemed to be an amount not exceeding 5 per cent of the full amount received by the enterprise on account of the carriage of passengers or freight embarked in that other State;  
    b.the tax chargeable in that other State shall not exceed 50 per cent of the profits as calculated under the provisions of subparagraph (a).
  7. Sources advise: "The countries must be within the United Kingdom boundaries, hence only the Isle of Man qualifies." As such, this treaty would be valid for residents of Great Britain, Northern Ireland and the Isle of Man.
  8. The treaty only applies to residents of Hong Kong, SAR.  

Remarks

The tax must be paid once the freight recipient receives the taxation forms, usually within three months of the vessel's call. When a tax exemption treaty is in place, the freight tax payment is waived. 

 

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