This SARS tax pocket guide has been developed to provide a synopsis of the most important tax, duty and levy related information.
A provisional taxpayer is any person who earns income other than remuneration or an allowance or advance payable by the person's principal.
Individuals below the age of 65 who do not carry on a business and whose taxable income- º will not exceed the tax threshold for the tax year; or º from interest, dividends and rental will be R20 000 or less for the tax year.
º is R120 000 or less for the tax year.
The taxable income from a retirement fund lump sum withdrawal benefit (lump sum from a pension, provident or retirement annuity fund on withdrawal) is determined after deducting a lifetime exemption of R22 500. The tax payable is determined by applying the rate table to the aggregate of the taxable portions of all retirement fund lump sum withdrawal benefits accrued during the current and previous years of assessment and deducting tax payable according to the current tax table on the aggregate of those lump sums accrued during previous years of assessment.
The taxable income from a retirement fund lump sum benefit (lump sum from a pension, provident or retirement annuity fund on retirement) is determined after deducting a lifetime exemption of R300 000. The tax payable is determined by applying the rate table to the aggregate of the taxable portions of all retirement fund lump sum benefits and retirement fund lump sum withdrawal benefits accrued during the current and previous years of assessment and deducting tax payable according to the current tax table on the aggregate of those lump sums accrued during previous years of assessment.
Most dividends received by individuals from foreign entities are taxable.
Interest and otherwise taxable dividends earned by any natural person under 65 years of age, up to R21 000 per annum, and persons 65 and older, up to R30 000 per annum, are exempt from taxation. Foreign interest and foreign dividends are only exempt up to R3 500 out of the total exemption.
Interest is exempt where earned by non-residents who are physically absent from South Africa for 183 days or more per annum and who are not carrying on business in South Africa.
The greater of―7,5% of remuneration from retirement funding employment, or R1 750. Any excess may not be carried forward to the following year of assessment.
Maximum of R1 800 per annum. Any excess over R1 800 may be carried forward to the following year of assessment.
Any excess may be carried forward to the following year of assessment.
Taxpayers under 65 are not taxed on, or may deduct, monthly contributions to medical schemes up to R625 for each of the first two dependants on their medical scheme and R380 for each additional dependant.
Taxpayers under 65 may claim all qualifying medical expenses, where the taxpayer or the taxpayer's spouse or child is a person with a disability.
Deductions in respect of donations to certain public benefit organisations are limited to 10% of taxable income before deducting medical expenses.
Where the accommodation to which that allowance or advance relates is outside the Republic, the daily amount deemed to have been expended is available on the SARS website.
Rates per kilometre which may be used in determining the allowable deduction for business travel, where no records of actual costs are kept.
Value of the vehicle Fixed cost Fuel cost Maintenance (including VAT) (R) (R p.a.
0 - 40 000 14 672 58.6 21.7 40 001 - 80 000 29 106 58.6 21.7 80 001 - 120 000 39 928 62.5 24.2 120 001 - 160 000 50 749 68.6 28.0 160 001 - 200 000 63 424 68.8 41.1 200 001 - 240 000 76 041 81.5 46.4 240 001 - 280 000 86 211 81.5 46.4 280 001 - 320 000 96 260 85.7 49.4 320 001 - 360 000 106 367 94.6 56.2 360 001 - 400 000 116 012 110.3 75.2 exceeding 400 000 116 012 110.3 75.
The fixed cost must be reduced on a pro-rata basis if the vehicle is used for business purposes for less than a full year.
Of the actual distance travelled during a tax year, in the absence of a log book, it is deemed that the first 18 000 kilometres are travelled for private purposes and the balance, but not exceeding 14 000 kilometres, are travelled for business purposes.
60% of the travelling allowance must be included in the employee's remuneration for the purposes of calculating PAYE.
Where the distance travelled for business purposes does not exceed 8 000 kilometres per annum, no tax is payable on an allowance paid by an employer to an employee, up to the rate of 292 cents per kilometre regardless of the value of the vehicle.
This alternative is not available if other compensation in the form of an allowance or reimbursement is received from the employer in respect of the vehicle.
Other than the deductions set out above an individual may only claim deductions against employment income or allowances in limited specified situations, e.g. bad debt in respect of salary and premiums on certain income protection policies.
The taxable value is 2,5% of the determined value (usually the cash cost excluding VAT) per month. Where a second (and further) vehicle is made available to an employee or his family, and the vehicle is not used primarily for business purposes, the benefit is 2,5% per month on the vehicle with the highest value and 4% per month on the other vehicle(s).
Where the employee bears the cost of all fuel used for the purposes of the private use of the vehicle (including travelling between the employee's place of residence and his/her place of employment) the monthly percentage to be applied is reduced by 0,22 percentage points.
If the employee bears the full cost of maintaining the vehicle (including the cost of repairs, servicing, lubrication and tyres) the monthly percentage to be applied is reduced by 0,18 percentage points.
The difference between interest charged at the official rate and the actual amount of interest charged, is to be included in gross income.
The formula will apply if the accommodation is owned by the employer, or an associated institution in relation to the employer, or under certain limited circumstances where it is not owned by the employer.
STC is imposed at a rate of 10% on dividends declared by resident companies after being reduced by dividends receivable during a dividend cycle. South African branches of foreign resident companies are exempt from STC.
Residents are taxed on their worldwide income, subject to certain exclusions. Foreign taxes on that income are allowed as a credit against South African tax payable. This is applicable to individuals, companies, close corporations and trusts.
Capital gains on the disposal of assets are included in taxable income.
Events that trigger a disposal include a sale, donation, exchange, loss, death and emigration.
instead of the annual exclusion, the exclusion granted to individuals is R120 000 during the year of death.
VAT is levied at the standard rate of 14% on the supply of goods and services by registered vendors. A vendor making taxable supplies of more than R1 million per annum must register for VAT and a vendor making taxable supplies of more than R20 000 (R50 000 from March 2010) but not more than R1 million per annum may apply for voluntary registration. Certain supplies are subject to a zero rate or are exempt from VAT.
Estate duty is levied at a flat rate of 20% on property of residents and South African property of non-residents. A basic deduction of R3,5 million is allowed in the determination of an estate's liability for estate duty as well as deductions for liabilities, bequests to public benefit organisations and property accruing to surviving spouses.
Donations tax is levied at a flat rate of 20% on the value of property donated.
The first R100 000 of property donated in each year by a natural person is exempt from donations tax.
In the case of a taxpayer who is not a natural person, the exempt donations are limited to casual gifts not exceeding R10 000 per annum in total.
The tax is imposed at a rate of a ¼ of a per cent on the transfer of listed or unlisted securities. Securities consist of shares in companies or member's interests in close corporations.
R150 per passenger departing on international flights excluding flights to SACU countries in which case the tax is R80.
A skills development levy is payable by employers at a rate of 1% of the total remuneration paid to employees. Employers paying annual remuneration of less than R500 000 are exempt from the payment of Skills Development Levies.
Unemployment Insurance contributions are payable monthly by employers on the basis of a contribution of 1 per cent by employers and 1 per cent by employees, based on employees' remuneration below a certain amount.
Fringe benefits - interest-free or low-interest loan (official rate) 13% p.a.
Late or underpayments of tax 15% p.a.
Refund of overpayments of provisional tax 11% p.a.
Refund of tax on successful appeal or where the appeal was conceded by SARS 15% p.a.
Refund of VAT after prescribed period 15% p.a.
Late payments of VAT 15% p.a.
Customs and Excise 15% p.a.
Total fuel and Road Accident Fund levies increase by 40.