Introduction
Bridging Complexity and Practical Guidance
Maema opens by clarifying the foundational test for a CFC—foreign incorporation combined with more than 50 percent South-African control or voting rights—and explains how section 9D deems a proportion of that company’s net income to be taxable in South Africa. She then unpacks the 10 percent “minority safe-harbour,” illustrating when shareholders can legitimately escape the deemed-income inclusion.
A substantial portion of the article is devoted to the Foreign Business Establishment (FBE) exemption, the critical carve-out designed to spare genuine offshore operations from unintended double-tax exposure. Drawing on the recent Supreme Court of Appeal decision in CSARS v Coronation Investment Management SA (Pty) Ltd, Maema shows how outsourcing core investment functions outside the host country can jeopardise FBE status.
“Section 9D favours a balanced approach: it combats base-erosion without punishing genuine commercial activity. The onus is on multinationals to prove substance, not rely on form,” Maema writes (TaxTalk p. 24).
Preparing for the 2026 Amendments
Looking ahead, Maema analyses the Taxation Laws Amendment Act 42 of 2024, which introduces the stricter “important functions” test that will apply from 1 January 2026. Under the new wording, all revenue-generating activities for which a CFC is compensated must be performed at its fixed place of business or, in limited cases, outsourced only to a same-country group entity. She warns that multinationals relying on regional service hubs or third-party managers now face heightened compliance risk.
To help taxpayers prepare, Maema offers a concise action plan: undertake a CFC substance audit, re-evaluate cross-border outsourcing, bolster documentation packs and align group governance with OECD BEPS guidance.
Why the Feature Matters
Being invited to publish in TaxTalk underscores both Maema’s individual expertise and MNS Attorneys’ standing in the tax community. The article arrives at a pivotal moment as corporates scramble to understand how the amendments will reshape their offshore structures. By translating dense legislation into clear next steps, Maema provides the business community with exactly the roadmap it needs.
Published By
About Ororiseng Maema
Maema holds a BA Law and LLB from North-West University and an LLM (Tax) from the University of Johannesburg. Admitted as an attorney of the High Court and a general tax practitioner with the South African Institute of Taxation, she advises public- and private-sector clients on cross-border structuring, procurement and tax dispute resolution.
Partner with MNS Attorneys
MNS Attorneys offers bespoke CFC health-checks, global tax-governance frameworks and end-to-end representation in SARS audits, objections and appeals. Organisations seeking to future-proof their international structures ahead of 2026 are invited to contact the firm’s tax team at tax@mnsattorneys.co.za.
Read the full article in TaxTalk Issue 113 by downloading the magazine from the South African Institute of Taxation website or above.
Our Vision
To be one of the leading law firms in South Africa, delivering exceptional legal expertise and embodying Black excellence within the legal fraternity.
Our Mission
To timeously provide legal expertise of the very highest standard, and to be relentless in our pursuit of positive outcomes for our clients, enabling them to focus on delivering their business goals.
“Whatever your life’s work is, do it well. Do it so well that no one else could do it better”
Share This Article
Stay Updated on MNS Attorneys' Success
MNS Attorneys’ Director Mr Thobani Mnyandu Explains the Issue of Rule 3 Notices
As the Madlanga Commission continues its inquiry into organised crime and alleged interference within the criminal-justice system, Mr Thobani Mnyandu, Director at MNS Attorneys, joined
MNS Attorneys’ Ororiseng Maema Showcased In Sait’s TaxTalk
South Africa’s flagship tax-law journal, TaxTalk, has featured Ororiseng Maema, an associate in MNS Attorneys’ Corporate & International Tax team, in its July/August 2025 edition
How Marathons Are Transforming South African Communities
Marathon events in South Africa are more than just races; they serve as community-building platforms, economic drivers, and symbols of resilience. In a recent episode
