Considering Immigration? Here’s How the UK, Australia, New Zealand and Canada Stack Up Against South Africa on Tax
With more South Africans considering emigration than ever before, questions around tax have become more urgent — and more personal.
- “Will I be taxed more or less if I leave South Africa?”
- “How do capital gains and dividends work overseas?”
- “Will I still need to pay SARS?”
These are the right questions to ask before you pack your bags. In this blog, we compare the four most popular emigration destinations for South Africans:
- United Kingdom
- Australia
- New Zealand
- Canada
- and of course, South Africa itself We unpack how these countries compare when it comes to:
- Dividend Tax
- Capital Gains Tax on Fixed Property
- Individual Income Tax Brackets
- Corporate Income Tax
- Donations and Gift Tax
1. Dividend Tax – What Gets Withheld Before You Even See It?
In South Africa, individuals pay a flat 20% dividends tax, withheld at source. Here’s how the others compare:
| Country | Dividend Tax Rate (Individuals) |
|---|---|
| South Africa | 20% (withholding tax at source) |
| United Kingdom | 0% on first £500, then 8.75%–39.35% depending on tax band |
| Australia | 0% if fully franked; otherwise taxed at income tax rates |
| New Zealand | Up to 33% (credits available for imputation/franking) |
| Canada | 15%–33% depending on province and type of dividend |
🟢 Best for dividends?
The UK (low effective rates for small investors), followed by Australia if dividends are franked. South Africa’s 20% rate is high and offers no imputation system.
2. Capital Gains Tax on Property – What Happens When You Sell a House?
South Africans pay capital gains tax on property disposals, with 40% of the gain included in taxable income. At the top tax rate of 45%, this means up to 18% effective CGT.
| Country | Capital Gains Tax on Fixed Property (Individuals) |
|---|---|
| South Africa | Up to 18% (40% inclusion into income × 45% rate) |
| United Kingdom | 18% or 28% (residential property, based on income band) |
| Australia | 50% of the gain is exempt if held >1 year; taxed at income tax rates |
| New Zealand | No CGT on most property, but Bright-line Test applies (up to 39%) |
| Canada | 50% of gain included in income; taxed at personal rates (max ~27%) |
🔍 Best for selling property?
New Zealand (for long-held homes) and Australia (with the 50% exemption) are typically better than South Africa. The UK and Canada are similar but allow strategic exemptions.
3. Individual Income Tax – How Much of Your Pay Goes to the Tax Man?
South Africa uses a steeply progressive tax table with a top marginal rate of 45%. How does that compare?
🇿🇦 South Africa (2024/25)
| Taxable Income (ZAR) | Rate |
|---|---|
| 0 – 237,100 | 18% |
| 237,101 – 370,500 | 26% |
| 370,501 – 512,800 | 31% |
| 512,801 – 673,000 | 36% |
| 673,001 – 857,900 | 39% |
| 857,901 – 1,817,000 | 41% |
| Over 1,817,000 | 45% |
🇬🇧 United Kingdom
| Taxable Income (GBP) | Rate |
|---|---|
| 0 – 12,570 | 0% (personal allowance) |
| 12,571 – 50,270 | 20% (basic rate) |
| 50,271 – 125,140 | 40% (higher rate) |
| Over 125,140 | 45% (additional rate) |
🇦🇺 Australia
| Taxable Income (AUD) | Rate |
|---|---|
| 0 – 18,200 | 0% |
| 18,201 – 45,000 | 19% |
| 45,001 – 120,000 | 32.5% |
| 120,001 – 180,000 | 37% |
| Over 180,000 | 45% |
🇳🇿 New Zealand
| Taxable Income (NZD) | Rate |
|---|---|
| 0 – 14,000 | 10.5% |
| 14,001 – 48,000 | 17.5% |
| 48,001 – 70,000 | 30% |
| 70,001 – 180,000 | 33% |
| Over 180,000 | 39% |
🇨🇦 Canada (Federal Only)
| Taxable Income (CAD) | Federal Rate |
|---|---|
| 0 – 55,867 | 15% |
| 55,868 – 111,733 | 20.5% |
| 111,734 – 173,205 | 26% |
| 173,206 – 246,752 | 29% |
| Over 246,752 | 33% (plus provincial rates) |
🧾Bottom line?
South Africa is still among the highest-tax countries for top earners, on par with the UK and Australia. New Zealand and Canada are marginally lower at the top, but the difference narrows after factoring in local taxes
4. Corporate Income Tax – What Will Your Business Pay?
South African companies now pay a flat 27% corporate tax rate.
| Country | Corporate Tax Rate |
|---|---|
| South Africa | 27% |
| United Kingdom | 25% (for companies earning over £250,000) |
| Australia | 30% (or 25% for base rate entities) |
| New Zealand | 28% |
| Canada | 15% federal + 11%–16% provincial (average ~26%–30%) |
🏢 Best for businesses?
Canada, the UK, and South Africa all sit in the mid- to upper-20s, with little practical difference. Australia is harsher unless you qualify as a base-rate entity.
5. Donations Tax – Is There a Price on Generosity?
South Africa charges 20% on donations, increasing to 25% once lifetime donations exceed R30 million. Certain exemptions apply (e.g., R100,000 per year to individuals)..
| Country | Donations / Gift Tax |
|---|---|
| South Africa | 20% up to R30 million; 25% thereafter |
| United Kingdom | No donations tax, but gifts can trigger Inheritance Tax (IHT) at 40% |
| Australia | No donations tax |
| New Zealand | No donations tax |
| Canada | No donations tax; capital gains may apply if gifting appreciated property |
🎁 Best for gifting?
Australia and New Zealand allow tax-free giving. South Africa is stricter than all the others on this point.
Conclusion – How Do These Countries Stack Up?
| Tax Type | SA Rank (Compared to UK, Aus, NZ, Canada) |
|---|---|
| Dividend Tax | Highest |
| CGT on Property | Mid-to-high |
| Income Tax | Among the highest |
| Corporate Tax | Middle |
| Donations Tax | Strictest |
Planning to Emigrate? Don’t Forget SARS.
If you’re considering permanent relocation, don’t just plan your visas — plan your tax exit properly. Leaving South Africa means:
- Ceasing tax residency
- Capital gains exit tax
- Financial emigration notifications (if needed)
- Offshore structure considerations
Chat to On Q Accounting and Tax Services (Pty) Ltd to ensure you avoid double tax, structure correctly, and notify SARS on time.
Disclaimer: This article is intended for general information purposes only and does not constitute professional tax advice. For tailored guidance, please speak to a registered tax practitioner.