EMPLOY IN SOUTH AFRICA WITH EASE
Expanding into South Africa – which is characterised by a qualified and talented workforce, multifaceted employment and tax laws, a developing infrastructure network, and leading sectors in mining, industry, agriculture, and tourism – can bring excitement to the possibilities, but also significant stress to ensuring the entity with the country’s rigorous legal structures and laws. Ensuring compliance without sufficient knowledge of the country’s laws also adds to the stress of getting your new entity off the ground and ready to test new markets. Going at it without the proper support can increase the costs, time and risks involved.
Global expansion is a step to make for any business, regardless of what you wish to achieve. The opportunities that can come with an expansion can be both incredibly exciting as well as intimidating and confusing, especially when you consider all the registration procedures that need to be done and the documentation required. Each new markets bring new challenges, and these can be worked through more efficiently and cost-effectively with the support of a Professional Employer Organisation (PEO) such as Bradford Jacobs, especially through our Employer of Record (EOR) framework. This can be best utilised when businesses are just beginning their expansion process and require more information before committing to incorporating an entity and fully establishing themselves in that market.
The Economy of South Africa is the second largest in Africa and the most industrialized, technologically advanced, and diversified in Africa overall. South Africa is an upper-middle-income economy, one of only eight African countries.
Following 1996, after over twelve years of international sanctions, South Africa’s Gross Domestic Product (nominal) almost tripled to US$416 billion in 2011. In the same period, foreign exchange reserves increased from US$3 billion to nearly US$50 billion, creating a diversified economy with a growing and sizable middle class within two decades of ending apartheid.
Although the mining industry remains one of the largest in the country, with an annual contribution to the GDP of US$13.5 billion, the economy of South Africa has diversified since the end of apartheid, particularly towards services.
High-class business services, with comprehensive financial and auditing back-up, are among the plus points. In 2019, the financial industry contributed US$41.4 billion to South Africa’s GDP. In 2021, South Africa-based financial institutions managed more than US$1.41 trillion in assets. The total market capitalization of the Johannesburg Stock Exchange is US$1.28 trillion as of October 2021.
Growth was reflected in manufacturing, petroleum production, chemicals, food, metals, and machinery. Consumer and household purchases increased, along with growth in the hospitality sector. The nation is among the G20 and is the only African member of the group.
SMEs across South Africa represent more than 98 per cent of businesses, employ between 50 and 60 per cent of the country’s workforce across all sectors, contribute to 39% of the GDP and are responsible for a quarter of job growth in the private sector.
Digital and new technologies create an opportunity for SMEs to enhance their reach and efficiency at lower costs, overcoming the scale disadvantage relative to more prominent players. South Africa is a prime target for such expansion, with its highly developed business and financial services sector adding to the nation’s attraction as a ‘Gateway to Africa’.
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Capital |
Pretoria (administrative), Cape Town (legislative) and Bloemfontein (judicial) |
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No. of States/Provinces |
9 - Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West and Western Cape |
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Principal Cities |
Port Elizabeth, Bhisho, Bloemfontein, Johannesburg, Pietermaritzburg, Durban, Polokwane, Mbombela, Mahikeng, Klerksdorp, Kimberley, and Cape Town |
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Language |
11 - English, Afrikaans, Xhosa, Zulu, Southern Sotho, Northern Sotho, Tswana, Tsonga, Venda, Swati, Ndebele |
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Local Currency |
South African Rand (ZAR) |
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Major Religion |
Christianity (78%, of which 58.3% of Protestantism) |
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Date Format |
yyyy/mm/dd |
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Time Zone |
South African Standard Time (UTC+2) |
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Country Dial Code |
+27 |
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Population |
60.6 million |
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Border Countries |
Namibia, Botswana, Zimbabwe (North), Mozambique, Eswatini (East and Northeast) and Lesotho (enclave). |
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Tax Year |
1 March – 28/29 February |
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VAT & |
15% |
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Minimum Wage |
ZAR 23.19/h (EUR 1.29/h) since March 2022 |
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Taxpayer Identification Numbers |
13 digits number South African Revenue Service (SARS) TIN |
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Leading Sectors |
Services 64.57%, industry and manufacturing 23.42%, and agriculture 2.53% (2021) |
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Main imports |
Chemicals and related products, motor vehicles and parts, crude and refined petroleum, broadcasting equipment |
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Main exports |
Natural resources, precious and base metals, agricultural goods, military equipment |
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Main trading partners |
China, USA, Germany, Japan, India, UK, Saudi Arabia |
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Government Type |
Constitutional and parliamentary Republic |
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Current President |
Matamela Cyril Ramaphosa (since February 2018) |
General requirements
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