The Trusted Employer Scheme allows employers to more easily get visas
Home affairs minister Aaron Motsoaledi says the remote work visa is for people who are employed in other countries but want to perform that work remotely while staying in South Africa. File photo.
Image: Trevor Samson
Amendments to immigration regulations are important to make it easier for foreigners to obtain visas for tourism, business and work, and this will in turn promote investment in South Africa, said home affairs minister Aaron Motsoaledi on Tuesday.
He made this remark during a media briefing in which he outlined proposed amendments to the regulations.
President Cyril Ramaphosa had in 2022 announced the country would be reviewing its visa regime to make this possible. Ramaphosa appointed Mavuso Msimang, a former director-general in the department of home affairs, to lead an operation aimed at reviewing the work visa system.   
Motsoaledi said Msimang`s report made a number of recommendations and on February 8 the department published draft immigration regulations for public comment with a closing date of March 29.
Motsoaledi said the regulations dealt with the introduction of the remote work visa, the introduction of the Trusted Employer Scheme, the introduction of the point-based system for general work visas and the frequent updating of the critical skills list �` which was previously updated only every four years.
Motsoaledi said the remote work visa is for people who are employed in other countries but want to perform that work remotely while staying in South Africa.
“These will be people in IT, auditing, finance and any other job which allows you to work remotely. But the catch here is that none of them must earn an equivalent of less than R1m. The offer to them is that they do not have to pay tax for employment of six months.”
Motsoaledi said the introduction of the Trusted Employer Scheme (TES) for qualifying companies was a means to provide a flexible pathway for employers to obtain work visas expeditiously in line with best practices.
“In this, the responsibility of collecting documents locally and globally is given to the prospective employer with the proviso that when a random check is done an employer will not be found to have committed misrepresentation.”
Motsoaledi said this would enable the visa to be finalised within 20 days whereas before the scheme it was eight weeks.
“In other words, you are running your own game. The speed with which you will get people from other countries depends on how fast you collect that information to bring to home affairs.”
The TES became active from March 1. Out of the 108 companies that applied, 70 were successful and are now part of the scheme.
Motsoaledi said the criteria for participating in the TES include that the company must make an investment of R100m in the country and must have 100 or more employees, 60% of whom are South Africans. Priority is given to companies in the energy and infrastructure sectors.
Motsoaledi said previously that the frequency of gazetting changes to the critical skills list demanded by the Immigration Act was four years.
“The new thing in the amended regulations is that we have changed the frequency from four years to when it is necessary or when the need arises.”
He said the list was updated twice in 2023. The first was in February with reference to doctors, and the second was in September regarding veterinary services .

Home affairs minister Aaron Motsoaledi is to withdraw the new work visa regulations he gazetted on March 28 and says he was “ill advised” to gazette them the day before the March 29 deadline for public comments on the draft version.

This comes after a meeting at the National Economic Development and Labour Council (Nedlac) last week which raised questions about the process and demanded that the regulations be withdrawn

Home Affairs Minister Dr Aaron Motsoaledi also discussed how small businesses can now make use of the new start-up visas for staff.
Home Affairs Minister Dr Aaron Motsoaledi has highlighted a need to look at reworking spousal visa protocols after they contributed to a backlog at the department more so than any other visa category.
Speaking to media on amended immigration regulations on Tuesday, Motsoaledi and other officials also spent time explaining how businesses particularly small businesses can benefit from new visa schemes.
Visa backlog
The minister said about 90% of the visas in their backlog are applications for relative visas and spousal visas, and this needs looking at.
Motsoaledi described a “conundrum” of having to check that just about every spouse who applies is indeed legally married to the South African citizen.
“Unfortunately, we are reaching a situation were spouses are created where they don’t exist.” he said, explaining this includes couples who go to notary generals to write a contract that they are staying together as partners, and then taking that to Home Affairs to apply for spousal visas.
“But when we send immigration officers to visit such families they never find a spouse.”
Some couples claiming to be spouses also do not have marriage contract numbers, which makes verifying their legal union difficult.
Motsoaledi said critical skills, general work and business visas generally do not see a backlog.
However, another problem Home Affairs experiences is waiting for proof of qualifications from employers before issuing work visas.
Project team tackles the backlog
Director General Livhuwani Tommy Makhode said there is a project team working to clear the visa backlog.
In fact, the turnaround time of critical skills visas has been shortened from eight weeks to about four weeks, he said.
“We have also had an offer from the private sector that wants to come and assist and we are working on the modalities with regards to that,” Makhode said.
The exact figures detailing the visa backlog will be provided to the media at a later date, the officials said.
Trusted employer scheme
Deputy director-general of immigration services at Home Affairs Yusuf Simons said the trusted employer scheme was in its first round as a pilot programme.
“It is a new introduction of a world-wide phenomenon that is taking place to have relationships with employers,” he said.
“We are looking at taking another cohort from May onwards so if you meet the criteria of course you can apply.”
However, those who do not meet the criteria may approach the corporate account unit. This will allow SMMEs and NGOs to register through them, although they will not have the same privileges as larger companies.
The advantage of a start-up visa
As a recommended new visa category, the start-up visa will be implemented alongside a business visa that was already approved.
“The start-up visa makes provision for any person who intends to establish or want to invest in any business can then apply under the regulation 14(1) of the Immigration Act… that gives the opportunity for any small business that falls out of the trusted employer scheme category to slot into that category, or go to our large account unit and register there as an employer, where we will also have a team that looks at those applications,” Simons said

Motsoaledi was speaking at a media briefing in Hatfield, Pretoria, yesterday on the amended immigration regulations, over which he said there seemed to be some misunderstanding.He said as a result of the confusion, the department would be withdrawing the gazetted amendments to clear up the misconceptions and re-gazette them as early as next week.The minister admitted that his department was experiencing a backlog surrounding dependants, spouses and relatives’ visas being sought by foreign nationals who had been approved to come into the country after successfully obtaining employment.
He said in most cases while the approvals were easily obtained, they,= however, did not include spouses and dependants, which many were decrying as they were not willing to be separated from their families.
Despite understanding this need, Motsoaledi said there was a situation which allowed foreign nationals to obtain a spousal visa should they marry a South African citizen, which was causing a problem for the department.

With this loophole, he said they were finding that, in many cases, spouses that did not exist were being created through notarial contracts simply to obtain visas.

“Through the notarial contracts you come with a partner, and go to the notary general to write you a contract stating that you are staying together as partners and when you bring that to Home Affairs, they regard you as a spouse.“The number of notarial contracts is increasing day by day but when we send immigration officers to visit such families, they don’t find any spouse and yet we have a document that says we must issue a spousal visa,” Motsoaledi said.

The minister said what was even more alarming was the fact that the number of these kinds of contracts were growing in “leaps and bounds”, resulting in the backlog.

“This backlog is changing every day because the notarials are growing daily. Now we have a situation where immigration officers visit families for six months with no spouse in sight, so what are we to do? Unfortunately, it’s a problem we are going to have to change because it’s in the law.”

He stressed that his department usually did not experience backlogs on critical skills, general work and business visas “but people with critical skills may be complaining of delays referring to delays in obtaining spouses for their visas”.

“The only way to know that indeed we have delayed giving someone a critical skills visa is for companies to provide us with a name of the employed person, because once you appear in the gazette and give us a letter of employment from your employer we issue it (the visa) immediately.”

Motsoaledi said that while several complaints have been received from the Chamber of Business units and allegations by the media when requested to provide a list of names to verify, none were forthcoming.“The reality we face is that you might be an engineer with a PhD but if no company gives you a job in South Africa, why should we allow you to come? There must be a company that needs you and then we can come in and facilitate entry into the country.

“The change we are bringing in these amendments is to do away with the requirement of having to go to the Department of Employment and Labour and replace it with a point-based system.”

The minister said they were unable to expand more on the point-based system because it still needed to be gazetted as they wanted to hear what the public would say about the scoring or points awarded.

Inconsistencies create uncertainty and affect competitiveness.

The industry is ‘dominated by very small companies’ that cannot afford expensive tax consulting or accounting systems needed to cope with the complexities. Image: Shutterstock
Uncertainty around the value-added tax (Vat) treatment on services offered to foreign tour operators or foreign travellers continues to plague the local tourism industry.
Inconsistencies in the approach adopted by the South African Revenue Service (Sars) and an onerous administrative burden on particularly smaller companies are making South Africa uncompetitive compared to the rest of the world.
The South African Tourism Services Association (Satsa) unpacked the practical consequences of the Vat complexities for inbound operators and the implications of a tax court decision in the so-called Ken case during a recent webinar.
The Vat Act provides for a zero rating of services when a local entity renders services or goods to a foreign entity or individual abroad. However, the lack of uniformity in the act’s applications creates uncertainty.
More clarity
The Ken case has raised hopes for more clarity and certainty. Ken, a destination management company in the tourism industry, successfully appealed against additional Vat assessments raised by Sars in the tax court. The company assisted foreign tour operators in structuring tour packages for marketing and sale to the operator’s clients, all foreign tourists.
The tax court found in favour of the company and criticised Sars for its inconsistency with its own interpretation note, which was issued around 2016.
The note sets out the common law relationship between the principal (the supplier of the service) and the agent, and the Vat consequences of the relationship.
However, the tax court decision is only binding on the two parties, namely Sars and Ken, warns Jo Roman, senior associate at ENSafrica. The case is quite fact-specific and cannot be relied on in general terms.
Hence, there is continued uncertainty for the local tourism industry offering agency services to foreign travellers and operators.
The relationship
A lot turns on the relationship between the (foreign) principal and the (local) agent. Cliff Watson, tax director at BDO, says the two terms are being used quite loosely in the industry.
The agent is the authorised representative who affects the legal relationship between the principal and third parties, such as hotels. No contractual rights and obligations are established between the agent and the third parties. The agent merely acts as the conduit to bring about the legal relationships between the principal and the suppliers.
The principal must grant the agent the necessary authority to act on their behalf. If a dispute arises, the agent relies on that authority to show that the authority existed at the time when the legal act was concluded.
Craig van Rooyen, director of Tour d’Afrique, says the industry is dominated by very small companies that really cannot afford expensive tax consulting or accounting systems to assess what is liable to Sars on every booking they make or across the chain when changes are made.
Practical consequences
He gives an example of a small local business that acts as an agent for an Italian tour operator.
The company makes the bookings on behalf of the tour operator and receives an “arranging fee”. While in SA, the foreign travellers decide to stay longer and book additional excursions. Suddenly, these services are now consumed within the country, and the agency mechanism changes from an arranging fee to effectively becoming a principal that should charge the standard Vat rate on the services.
“If you do not have a proper system in place and there is no control over your finances, it becomes difficult and expensive to manage,” Van Rooyen adds.
Cullinan Holdings group financial director David Standage says the current reality for local tourism businesses is one of continued uncertainty. Their group navigates the Vat complexities by broadly following the Australian general sales tax guidelines.
There must be an agreement with the foreign tour operator to confirm the agency relationship. Some foreign operators state in their agreement that the SA agent supplies the service. This may result in a Vat liability for the local business, hence the importance of having their own agreement.
Charles de Wet, tax executive at ENSafrica, also warns against using “boilerplate” clauses in agreements with foreign tour operators. It must be clear that the local management company is not the buyer but sourcing it on behalf of the foreign entity.
“They do not have to be complicated agreements, but they need to be specific about the service you provide and in what capacity you are providing it.”
Continued interaction
David Frost, CEO of Satsa, says the industry continues to engage with the government and Sars to work with the industry as a partner. SA must be competitive as a tourism destination.
He says the interaction between the industry and government should not be acrimonious.
“The aim is to have a clear and defined set of guidelines, such as the Australians have, that small businesses who are genuine tourism entrepreneurs can adhere to and be compliant with,” Frost adds.
International tourist arrivals from January to December 2023 totalled 8.5 million, representing a 48.9% increase when compared with the same period in 2022.