Contracting in South Africa usually means sorting a bunch of issues beforehand.
How will I receive payments? What do I need before I start working? What will I do about accommodation? Can I bring my spouse? What about taxes?
On top of all these questions, there are often mountains of paperwork, unexpected fees, and complicated admin issues. Streamlining even a few of these issues will allow you to better focus on your new contract in South Africa.
So how do you make that happen?
The simplest, most cost-effective way is through an Umbrella Company.
Difficulties of contracting in South Africa
Generally, you need to have an employer sponsor in order to secure the appropriate work permit and work visa for South Africa.
If you’re working independently, it can be difficult to find clients willing to sponsor you. Moreover, even if your client can do this, you’ll need a new sponsor each time you decide to take on a new contract. Of course, every new sponsor will mean more paperwork.
Also, are you deeply familiar with the intricacies of the tax system in South Africa, as well as your own country’s laws on overseas earnings? If so, good on you!
However, if you’re like the rest of us, figuring out (much less reducing) your tax liability in South Africa and your home country can seem like full-time work in itself.
How Umbrella Companies in South Africa work
Most freelance workers aren’t mystical superheroes who successfully tackle these issues all on their own. There are companies who specialise in helping workers make the most out of their contracts.
They’re called Umbrella Companies (or, contractor management companies).
How do they work?
Basically, an Umbrella Company acts as your full-time employer, even though you maintain your independence as a contractor. They collect and filter payments from your clients, filtering out the necessary social security and fees. You send them your timesheets, and they send you payments.
Because they act as your “employer,’ they can sponsor you and provide a single work permit for multiple contracts.
Even better, most are experts in South Africa and expat tax law, meaning they’ll also help you optimise your earnings.
Although the Umbrella Company is technically your “employer,” you’re essentially freeing yourself to work even more independently. You still dictate your contracts, your hours, your schedule. The Umbrella Company simply filters out the time-consuming admin and immigration issues, allowing you to focus on your new contract.
How we help with Umbrella Companies in South Africa
There’s a huge variety of Umbrella Companies out there; they all have different specialties and advantages. How do you find the right one for your circumstances?
We work closely with Umbrella Companies all throughout South Africa and match contractors with the right company for them. If you’ve already secured a contract in South Africa, we can help you find your best match (for free). Or, we can simply give you feedback on your situation (for free).