Spurs CEO Freddy Mapulane confirmed Mkhatshwa's departure from the Emalahleni-based side, which finished four points shy of the promotional play-offs in fifth place on the NFD table.
Former Mbombela United mentor Mkhatshwa linked up with Mapulane's outfit in March along with Orlando Pirates legend and goalkeeping coach Williams Okpara, as Themba Mafu was shifted to a technical director role.
"I can just confirm that we won't be having Vusi Mkhatshwa as our coach in the new season," Mapulane tells KickOff.com.
"The reasons are simple, we had a short-term contract with him until the end of the season. So the league is now finished, so we didn't renew because he was committed somewhere when we took him. So the agreement was having a short-term contract, hence we'd like to keep him but he also wants to work near his home."
Mapulane says at this stage the club is still searching for a suitable candidate for the job.
"All CVs are welcome as we are still searching. But so far we haven't received any CV and we haven't identified anyone yet. Remember we only finished playing on Sunday. We are having our first meeting on Friday to discuss those issues regarding the coach and the players who will not be retained.
"We are looking at someone who's got NFD experience, who has worked in the NFD. Most preferably a local coach will do if somebody is available. We are looking for someone who will immediately adjust to the NFD. As you know it is not an easy league, especially for someone who is new in the league. He might struggle there and there. Out aim is to gain automatic promotion next season just like Highlands Park did. So we want to start preparing as early as possible so our pre-season can go very well. By next week I think we will be announcing our new coach, and by pre - season the new man must be in charge so that we give him enough chance to recruit and suggest some of the players that he might need."