A Fresh Proactive Provisional Tax Perspective

Every action becomes praiseworthy when driven by proactivity and positive intent. Let's gain a fresh perspective on the concept of Provisional Tax and how it aligns with being proactive.

Defining Provisional Taxpayers

Provisional taxpayers encompass:

• A person (Other than a Company) earning income other than remuneration, or those receiving remuneration from unregistered employers for employees' tax.
• Companies.
• Individuals designated as provisional taxpayers by the Commissioner.

Exclusions from Provisional Taxation:

Certain individuals and entities are excluded, including:

• Natural persons with no business income, and whose taxable income from interest, dividends, foreign dividends, rental from fixed property, and remuneration from unregistered employers falls below R 30,000.
• Approved public benefit organisations.
• Body Corporates and share block companies.
• Deceased Estates.

Provisional Tax Payment Deadlines:

• The first provisional tax payment (P1) is due within 6 months of the start of the assessment year. For assessment years commencing in March, this falls on August 31st or the last business day before this date.
• The second provisional tax payment (P2) must be made by the last business day of the assessment year. For assessment years starting in March, this deadline is the last business day of February.
• A third payment (P3) is optional and may be made:
  • For companies with a February year-end and other individuals (excluding companies) on the last business day of September.
  • In any other case, within 6 months of the assessment year.

Penalties for Late or Underestimated Provisional Tax Payments:

It is crucial to ensure your payment reaches SARS on or before the due dates. Underestimating taxable income attracts steep penalties if Provisional Taxes do not account for at least 80% (for taxable income over R1 million) or 90% (for taxable income under R1 million) by the end of the assessment year.

Our Proactive Approach:

Our proactive team channels their energy into matters they can influence positively. Their unwavering positivity allows them to carry their own weather, regardless of external circumstances.

Reach out to us for Proactive Provision services, and rest assured, a bright, sunshiny day awaits!