Here’s a KPMG article on it that describes it properly. https://home.kpmg/xx/en/home/insights/2018/01/flash-alert-2018-020.html
the main point to note is that it’s not blanket anyone who is a SA citizen and hasn’t financially emigrated as is implied by the one newspaper article - see “who will be affected” below. The background indicates that this is indeed part of the push to get tax from those people who are working in Dubai etc and not paying any tax in SA because of the physical presence exemption but who don’t have tax residence anywhere else either.
Another article I read that wasn’t as detailed said that if you have tax residence elsewhere (home, family, assets, pay normal tax there etc) this doesn’t affect you, it is aimed at SA tax residents abroad on employment contracts.
Who Will Be Affected?
The new cap will mainly affect South African tax residents working abroad; either as self-sponsored individuals who take a job opportunity in a foreign jurisdiction, or as employer-sponsored assignees that may or may not be tax protected/equalised.
South African tax residents are taxed on their worldwide income through the residence-based system. While DTTs exist to prevent double taxation under certain circumstances, a specific provision in the South African tax legislation provides a pre-emptive exemption, i.e., an exemption that statutorily limits South Africa’s taxing rights based on a set of criteria.
Many South African tax residents work abroad for a period during their working lives. Section 10(1)(o)(ii) of the Income Tax Act, No. 58 of 1962 (ITA) exempts employment income received by a South African tax resident during any year of assessment for services rendered outside South Africa for or on behalf of any employer, if that individual was outside South Africa for:
a period or periods exceeding 183 full days in aggregateduring any 12-month period, and
a continuous period exceeding 60 full days during that 12-month period.
The exemption is only available to employees of private-sector companies.
According to National Treasury, the exemption of foreign employment income from the South African tax net appears excessively generous, particularly in instances where the individual worked in a foreign country with a low or zero personal income tax rate.