South African entrepreneurs often register U.S. companies to serve American customers, raise investment, or access global payment processors. If that’s you, you may be asking: do I have to file U.S. taxes from South Africa?
Yes—if you’ve formed a U.S. LLC or corporation, you’re required to file taxes with the IRS. Your location doesn’t change the filing requirement—only where your company is registered does.
U.S. Federal Tax Obligations
What Forms You Need to File (By Entity Type)
C-Corporation
- Form 1120 – U.S. Corporation Income Tax Return
- Form 5472 – If your company is 25% or more foreign-owned and has reportable transactions
Single-Member LLC (Disregarded Entity)
- Form 5472 + Pro Forma 1120 – Required even with no income if there are reportable transactions
Multi-Member LLC (Partnership)
- Form 1065 – U.S. Return of Partnership Income
- Schedule K-1 – Issued to each partner
Individual Filing
- Form 1040-NR – If you earn U.S.-sourced income that is effectively connected with a U.S. trade or business
What Is ECI (Effectively Connected Income)?
ECI includes:
- Services performed in the U.S.
- U.S.-based staff or contractors
- Rental income from U.S. real estate
Just selling to U.S. customers from South Africa does not create ECI. But having a U.S. presence usually does.
Common South African Business Types That Must File
- SaaS or app companies serving U.S. users
- Consulting or remote service providers
- Online stores using U.S. fulfillment centers
- Startups with U.S. VC investment
U.S. Tax Culture vs. South Africa
Auditing and Filing
South Africa has formal accounting rules and many businesses are subject to audits and SARS filings. In the U.S., most small businesses don’t face audits unless something is flagged. U.S. tax returns are also private, unlike South Africa where some records may be more public.
VAT vs. U.S. Sales Tax
South Africa uses Value-Added Tax (VAT)—a tax on goods and services collected at each stage of the supply chain. The standard VAT rate is 15%.
The U.S. uses sales tax, which:
- Is applied only at the final point of sale
- Varies by state (not national)
- Mostly applies to physical goods and select services
Service-based companies typically do not have to collect U.S. sales tax. However, e-commerce businesses using U.S. warehouses may trigger state-level obligations.
Bookmate does not provide sales tax filing services.
Common Misunderstandings
- No revenue = no filing – Incorrect. U.S. entities must file even with no income.
- Only U.S. residents pay U.S. taxes – False. U.S. company ownership triggers filing obligations.
State Tax Responsibilities: Delaware and Wyoming
Delaware Franchise Tax (C-Corps)
- Due: March 1
- Cost: $225–$400+ depending on share setup
Delaware LLC Franchise Tax
- Due: June 1
- Cost: $300 flat
Wyoming Annual Report
- Due: Company anniversary month (month of incorporation)
- Cost: Starts at $60
These are separate from IRS federal requirements.
Do You Need an ITIN?
If you personally earn U.S.-sourced income and file a 1040-NR, you’ll need an ITIN (Individual Taxpayer Identification Number).
Summary
If you operate a U.S. company from South Africa, you have U.S. tax obligations. Your filing requirements depend on your company type and whether you have U.S.-connected income.
Book a free consultation to ensure you’re compliant: Schedule Now
Let Bookmate guide your U.S. tax strategy with confidence.
