Buying a South African business from the UK: treaty, tax, visas and time zones

What changes when the buyer is in the UK

The South African rules that apply to every foreign buyer are in our guides to buying a business in South Africa as a foreigner, exchange control for foreign investors and the business visa. This page covers the British side.

There is no UK exchange control permission to get: the UK abolished "all remaining exchange controls in October 1979" (Bank of England Quarterly Bulletin, September 1981). The controls that apply are South Africa's: non-residents "may freely invest" if the money comes in an approved way, which your South African bank handles (Currency and Exchanges Manual, 5 October 2026, section G(C)(i)). This is general information, not advice: you need a South African attorney, a tax adviser in each country and your bank.

The South Africa-UK double taxation convention

The convention was signed in London on 4 July 2002 and has been in force since 17 December 2002. It applies in South Africa to tax withheld on amounts paid from 1 January 2003, and in the UK from 6 April 2003 for income tax and capital gains tax (convention, Government Gazette 24335; HMRC: South Africa tax treaties). A protocol in force since 13 October 2011 rewrote Article 10 on dividends, with effect from 1 April 2012 (protocol, Government Gazette 34971). The OECD Multilateral Instrument (MLI) has modified the convention for withholding taxes since 1 January 2023 (SARS synthesised text of the convention and the MLI).

The limits for a UK resident beneficial owner, against South Africa's own rates (dividends from 22 February 2017, SARS; interest from 1 March 2015, SARS; royalties at 30 September 2026, Taxation in South Africa 2026):

• Claim the rate before the dividend is paid. The company withholds the treaty rate only with your declaration and undertaking in hand (taking dividends home); HMRC's certificate of residence proves you are UK resident (GOV.UK: tax on foreign income).
• Exceptions. The limits do not apply to a holding, loan or right effectively connected with a permanent establishment you have in South Africa (Articles 10(4), 11(3) and 12(3)), or where obtaining the benefit was one of the principal purposes of an arrangement (MLI Article 7(1)).
• Lending to your own company. The loan needs approval before the money moves: the Reserve Bank's (Manual, section G(C)(i)), or the company's bank's if the loan meets the Manual's criteria and is recorded on the Loan Reporting System (section I.3(B)(i)); see funding with a loan. Because you and the company are related, the treaty covers only an arm's-length rate of interest; any excess stays taxable under each country's law (Article 11(4)).

Selling later: which country taxes the gain

Under Article 13(5) of the convention, a gain on shares is taxable only in the country where you are resident under the treaty: the UK while you live there. Two exceptions matter, and the MLI changes neither (synthesised text).

Companies rich in South African land. South Africa may tax gains on unquoted shares deriving their value, or the greater part of it, directly or indirectly from immovable property in South Africa (Article 13(2)(a)), and gains on land or permanent-establishment assets you own there directly (Articles 13(1) and 13(3)). The treaty only permits the tax; whether South Africa charges it depends on its own rule for land-rich shares, which counts long leases as well as owned land (SARS capital gains tax guide, chapter 4; see our general guide). Where both tax, the UK gives credit (Article 21(2)(a)).

Moving to South Africa, then selling. Article 13(6) lets each country keep taxing, under its own law, an individual who was resident there at any time in the six years before the sale and held the shares before moving. So if you move to South Africa to run the business and sell within six years, both countries may tax the gain. UK law adds a rule of its own: if you had sole UK residence in at least four of the seven tax years before you left and return within five years, some capital gains and distributions from closely controlled companies received while away can be taxed in the year you return (HMRC RDR3, section 7, updated 11 June 2026). Take advice before you move, and before you sell.

How HMRC taxes your South African income

Dividends you receive personally

A UK resident normally pays UK income tax on foreign dividends (GOV.UK: tax on foreign income). From 6 April 2026 to 5 April 2027, dividends above the £500 dividend allowance are taxed at 10.75% (basic rate), 35.75% (higher rate) or 39.35% (additional rate) (GOV.UK: tax on dividends).

You can usually claim Foreign Tax Credit Relief for the South African dividends tax (Article 21(2)(a)), but not for South African company tax on the profits behind the dividend. The credit is capped at the treaty rate and at the UK tax on the same dividend (GOV.UK: if you're taxed twice). With 10% withheld, a basic-rate taxpayer has a small UK top-up and a higher-rate taxpayer pays the difference up to 35.75%. If 20% was withheld, HMRC still credits only 10%: reclaim the rest from SARS. Report the dividends on a Self Assessment return; if you do not usually file one, tell HMRC by 5 October after the tax year (GOV.UK: reporting foreign income).

If you moved to the UK recently

Since 6 April 2025, in your first four years of UK residence after ten or more years abroad, you can claim relief so that eligible foreign income and gains, including dividends from non-UK companies, are not taxed in the UK, losing certain allowances (GOV.UK: 4-year foreign income and gains regime).

Buying through a UK company

Most dividends a UK company receives, including from overseas companies, are exempt from corporation tax (HMRC CTM02060), so with at least 10% of the capital the South African 5% is usually the only tax on the dividend. Ask too about the controlled foreign company rules (HMRC INTM190000).

When the UK company later sells, the substantial shareholding exemption can take the gain out of corporation tax. It must have held at least 10% of the ordinary share capital, with matching rights to profits and assets, for a continuous 12 months within the six years before the sale, and the South African company must have been a trading company, or the holding company of a trading group, from the start of those 12 months until the sale (Taxation of Chargeable Gains Act 1992, Schedule 7AC, paragraphs 7, 8 and 19).

Selling as an individual, and death or gifts

A UK resident individual pays capital gains tax at 18% within the basic-rate band and 24% above it on gains from 6 April 2026, after an allowance of £3,000 for 2026 to 2027 (GOV.UK: Capital Gains Tax rates).

Since 6 April 2025, a long-term UK resident (UK resident for 10 of the previous 20 tax years) can owe inheritance tax on overseas assets, South African shares included, when giving them away or on death, and keeps that status for up to 10 tax years after leaving (GOV.UK, 6 April 2025). South Africa and the UK have a separate convention on estates and gifts, signed on 31 July 1978 and in force since 1979, which applies to deaths and gifts from 1 January 1978 (SI 1979/576; SARS: estate duty agreements).

UK rules that follow you to South Africa

Where the company is resident. A South African company run from the UK can end up resident in both countries. Since the MLI replaced Article 4(3), SARS and HMRC must try to agree its residence, considering its place of effective management, incorporation and other factors; until they do, it gets no treaty relief except as they agree (synthesised text, MLI Article 4(1)). Decide before you buy where the board will meet and take decisions.

The tax authorities share information. SARS and HMRC exchange information foreseeably relevant to either country's taxes, bank-held information included, and help collect each other's tax claims (Articles 25 and 25A, protocol, Articles III and IV). Keep your filings in the two countries consistent.

UK bribery law. A British citizen, a person ordinarily resident in the UK or a UK company that bribes a foreign public official, South African officials included, to win or keep business commits a UK offence even if every act takes place abroad (Bribery Act 2010, sections 6 and 12). A UK company also commits an offence if someone performing services for it, which can be its South African subsidiary, bribes to win business for it, unless it had adequate procedures to prevent bribery (sections 7 and 8).

UK sanctions. UK financial sanctions bind UK nationals and UK companies, including their branches, wherever they act. Check the seller and its owners against the UK Sanctions List before you pay: breaching an asset freeze can carry up to seven years' imprisonment (OFSI general guidance, updated 12 May 2026).

Visiting on a UK passport, and moving to run it

You do not need a visa to visit South Africa for up to 90 days on an ordinary UK passport. The United Kingdom is on Home Affairs' visa exemption list (DHA, issued 9 December 2025), and the High Commission in London says UK passport holders "are visa exempt for travel to SA up to 90 days" (High Commission: immigration services). The Electronic Travel Authorisation launched on 12 August 2026 is to be voluntary for visa-exempt travellers (Minister of Home Affairs, launch speech).

A visitor may not work, and work includes "conducting any activity normally associated with the running of a specific business" (Immigration Act, sections 1 and 11); ask an immigration practitioner where your plans fall. To live there and run the business you need a visa that allows it, usually the business visa, whose capital and staffing rules, and planned reforms, are in our business visa guide. What is specific to the UK:

• Where to apply. In person, at a South African mission in the country where you are ordinarily resident or a citizen (Immigration Regulations, regulation 9(2), which the 2024 amendments, GN R4847 and GN 5398, left unchanged). For a UK resident that is the High Commission in London, where VFS Global facilitates visa applications.
• Police certificate. You need one from each country where you lived for 12 months or more after turning 18, in the five years before you apply (GN R4847, 20 May 2024). For the UK, GOV.UK says to ask ACRO and lists South Africa among the countries that may want one (GOV.UK: police records).
• Tax residence. The UK decides residence year by year under the statutory residence test, and the year you leave can be split (HMRC RDR3). If both countries treat you as resident, Article 4(2) of the convention decides: first a permanent home, then centre of vital interests, habitual abode and nationality.

Moving sterling into rand

The UK side is an ordinary international payment. In South Africa the money goes through an Authorised Dealer, the South African office of a bank on the Reserve Bank's list (Manual, section A.2(A)); bureaux de change and transfer services are listed separately, with limited authority (section A.2(B)). Ask the receiving bank how the money must arrive, so it can confirm the payment and have your share certificate endorsed "Non-Resident" (section G(F); see bringing the money in). Bids, deposits and fees at our auctions are in rand, so plan with your bank when you will convert.

Working with Dynamic from the UK

South Africa keeps South African Standard Time (SAST, UTC+2) all year (IANA time zone database). The UK is on Greenwich Mean Time (GMT) in winter and British Summer Time (BST), an hour ahead, from the last Sunday in March to the last Sunday in October (GOV.UK: when do the clocks change).

Email info@dynamicauctioneers.co.za or WhatsApp +27 84 702 3766. Our online auction room takes a passport number at sign-up; like every bidder, you then complete FICA verification and register for each auction (how to register and bid online). Our only office is at 187 Gouws Avenue, Raslouw AH, Centurion. Start with our page for international buyers or browse the businesses for sale.