Posted on 3/27/2025 5:23 PM By Cor van Deventer
The tax treatment of independent contractors is a grey area for many South African businesses—especially when the contractor is closely tied to the company, such as a director or shareholder. It may seem easier (or even more tax-efficient) to have that individual invoice the business each month instead of drawing a formal salary. The core issue is whether the independent contractor truly operates independently, or whether the working relationship fits the legal definition of employment under the Income Tax Act.