Provisional tax



What is provisional tax?

Provisional tax is not a separate tax, but a way to pay your income tax in two or three installments.

Who must pay provisional tax?

All companies must pay provisional tax, except:

Public Benefit Organisations (PBO) approved by SARS
Recreational clubs approved by SARS
Body-Corporates
Share Block Companies
Any association of persons contemplated in section 10(1)(e)


All individuals must pay provisional tax, except:

If your only income is a salary.

or

If you are under 65 years old, and
you did not earn any taxable income from carrying on a business, and
your taxable passive income (interest, dividends and rent) is less than R30,000
             or
your taxable income is below the tax threshold (R75 000 for 2017).

or

If you are 65 years old or older, and
your taxable income for that year consists only of salary, pension, interest, dividends or rent; and
you did not earn any taxable income from carrying on a business, and
your taxable income for the tax year will not exceed R120 000.


All trusts must pay provisional tax if it earned taxable income.


When is provisional tax due?

The first provisional tax payment is due within 6 months of the beginning of the tax year, or of a company’s financial year.
For taxpayers with a February year-end, the first payment therefore has to be made before 1 September.

The second payment must be made by 28 February, or a company’s financial year-end.

If the first two payments were not sufficient to cover the tax liability, a third payment may be made within 7 months after year-end.

Reference: Fourth Schedule to the Income Tax Act 1962 (Act 58 of 1962)

Please contact us if you need any further assistance.