India–Africa Tax & Social Security 2025: Opportunities for NRIs

India’s network of tax treaties with African countries is shaping a busy 2025 for cross-border workers, startups, and major Indian companies in the region, even as formal pension coordination remains a work in progress. Officials and industry groups say the architecture built through The India–Africa double taxation treaty system is already cutting tax costs and providing legal certainty for Indian engineers, teachers, doctors, and IT professionals on the continent.

At the same time, practical hurdles around pension portability persist because no Social Security Agreement (SSA) has been concluded yet between India and an African nation, with discussions most advanced with South Africa and timelines pointed to after 2025.

India–South Africa: the focal point for mobility in 2025

The India–South Africa treaty (DTAA), updated in 2011, is central to professional mobility this year.

• It applies the tax credit method and caps withholding on dividends and interest at 10%, matching the cap on royalties.
• Business income is taxed only when a permanent establishment (PE) exists, and capital gains are taxed where the asset is located.
• Artists, independent professionals, and researchers are covered — relevant for cities like Johannesburg and Cape Town where Indian media, consulting, and research projects have multiplied.

South Africa’s revenue authority stresses that treaty relief should be backed by proper documentation. Its public guidance on double tax agreements explains how residents can claim relief through domestic rules aligned with treaties. For reference, the South African Revenue Service maintains a DTAA resource page outlining treaty texts and the processes for claiming relief, including India’s agreement: SARS: Double Taxation Agreements.

Mauritius and Kenya: anchors for capital and operations

Mauritius and Kenya remain key jurisdictions for Indian capital and regional operations.

Mauritius:
– The India–Mauritius DTAA was overhauled in 2016.
– Capital gains for investments made before 1 April 2017 are grandfathered.
– Gains on investments made after that date are taxed in India, with Mauritius offering credit relief to avoid double taxation.
– This predictability matters for holding companies and startup investors using Mauritius as a gateway to African markets.

Kenya:
– The DTAA signed in 1985 covers business income, employment, dividends, royalties, and shipping.
– Double-tax relief is via the credit method, and there is a 15% cap on technical-service fees and royalties.
– Indian telecom and infrastructure firms building fiber, towers, and roads in East Africa rely on these provisions for long-term contracts.

Nigeria and Egypt: energy, infrastructure, and services corridors

Nigeria and Egypt round out core corridors for Indian professionals and businesses using DTAA protection.

Nigeria:
– The India–Nigeria DTAA (in force since 1989) is often cited by oil-and-gas contractors, EPC firms, and engineering consultancies.
– It simplifies taxation for petroleum-related services and fixes royalties and technical fees at a 10% ceiling.

Egypt:
– The DTAA caps withholding on dividends and royalties between 10% and 15%.
– It exempts students and professors under specific treaty provisions.
– It ensures consistent treatment of air and shipping income for Indian carriers.

Taken together, these treaties allow Indian businesses and professionals to operate across a growing set of African markets while avoiding the drag of double taxation.

How treaties affect paychecks, invoices, and business decisions

The treaties’ practical value shows up in everyday transactions:

• Indian employees seconded to South African subsidiaries report that DTAA relief often determines whether they take home a predictable salary after local withholding.
• Indian students on scholarships in South Africa, Egypt, and Mauritius benefit from treaty-based exemptions that protect stipends from unexpected tax.
• Architects and software teams servicing multi-country projects plan around permanent establishment thresholds to stay compliant and reduce audit risk.

According to analysis by VisaVerge.com, India now has DTAAs with more than 25 African countries, helping non-resident Indians avoid double taxation while keeping investments compliant with both Indian and local rules.

Scale and sectors affected

• More than 3 million people of Indian origin live across Africa, concentrated in South Africa, Kenya, Mauritius, Tanzania, and Nigeria.
• Indian firms such as Tata, Mahindra, Infosys, and Airtel Africa employ thousands and rely on treaty provisions when transferring teams, distributing dividends, or paying royalties.
• The rise of Indian-led healthtech, fintech, and edtech in Nairobi, Lagos, and Johannesburg depends on clear rules for cross-border payments.

Under DTAA protections:
– Investors and affiliates typically face 10–15% withholding on dividends and around 10% on royalties — lower than default domestic rates that could erode returns or stall projects.

Pension portability: progress lagging behind

Two forces are running side by side in 2025: wider use of DTAAs for tax certainty, and slow but visible steps toward pension coordination.

• India’s government has flagged the need to align social security systems so Indian employees posted in Africa are not penalized by duplicate contributions they cannot later access.
• At present, no SSA is in place with any African country. Workers in South Africa, Mauritius, and Kenya usually contribute to local pension or provident funds; refunds or withdrawals are sometimes possible on exit, but systematic portability into India’s Employees’ Provident Fund Organisation (EPFO) framework is not yet available.
• India and South African officials have discussed ways to coordinate EPFO and SARS processes under the India–Africa Forum Summit track, with expectations for movement by 2026.
• Mauritius offers portability for permanent residents, allowing retirees to receive benefits in rupees, but this is governed by domestic rules rather than a bilateral SSA.

Policy urgency is driven by the region’s growth: India–Africa trade crossed $100 billion in 2025, powered by energy, IT, pharmaceuticals, and education. The treaties secure more than $70 billion in Indian investments across Mauritius, South Africa, and Kenya.

Treaty detail matters for location and pricing

Experts stress that individual treaty provisions shape where professionals and companies base operations:

• In South Africa, the credit method ensures Indian residents do not suffer double taxation when they hold proper Tax Residency Certificates (TRCs) and documentation.
• In Mauritius, post-2017 capital gains on Indian company shares are taxed in India, yet the jurisdiction still offers predictability for substance-based holding platforms.
• In Kenya, the 15% cap on technical-service fees is often built into project pricing.
• In Nigeria, the 10% cap on royalties helps engineering and oilfield service providers maintain margins after local taxes and currency pressures.

Practical compliance checklist

Tax practitioners advise Indian professionals and firms to follow these steps:

1. Obtain and keep a Tax Residency Certificate (TRC) when claiming foreign tax credits at home.
2. Maintain contracts, pay slips, and proofs of local tax payments.
3. Identify whether activities create a permanent establishment (PE) in the host country.
4. Track residency tests — generally 183-day thresholds or where a person’s permanent home is — to determine treaty tie-breakers.

Without a PE, business profits are typically taxed only in the home country; with a PE, local corporate tax may apply and treaty rules then determine relief.

Important: Keep all documentation current and readily accessible. Treaty relief is only effective when supported by the right paperwork.

Social and human impacts

The social side is urgent and tangible:

• Indian families in Johannesburg and Durban are increasingly seeking pension clarity as they plan longer stays.
• Workers who contributed for years to local funds worry about fragmented records when returning to India.
• Advisers urge people to keep every statement and contribution record safe in case future SSA rules allow portability or crediting of service.

For now, refunds on exit and domestic portability in host countries offer some relief, but the absence of bilateral SSAs means automatic, frictionless portability is not yet available. Many in the diaspora want that gap closed before more savings become trapped in separate systems.

Startups and regional base decisions

Startups are adjusting how they pick regional bases:

• Nairobi and Port Louis (Mauritius) compete to attract Indian founders, especially in fintech and edtech.
• DTAAs reduce tax friction on software royalties, lower withholding on investor dividends, and add predictability on repatriating capital to India.
• The India–Africa Startup Bridge launched in 2024 aims to help with tax-compliant incorporation; early users report smoother filings and better due diligence from local partners who understand DTAA protections.

Founders’ objective is simple: keep cross-border tax lawful, predictable, and efficient so they can hire locally and scale products.

Policy direction and next steps

Officials and industry groups largely agree on priorities:

• Expand practical tax certainty through effective use of treaties.
• Strengthen documentation and compliance practices.
• Push harder on Tax & Social Security coordination to ensure contributions follow workers across borders.

For professionals and startups the message is straightforward: treaties are in force, caps and thresholds are understood, and relief is available when paperwork matches the rules. The pending question in 2025 is whether pension portability can catch up to the pace of trade and hiring.

Until SSA frameworks are agreed, the DTAA system remains the backbone of India–Africa mobility — technical, quiet, and decisive where it counts: in pay slips, invoices, and long-term investment plans.