Provisional Tax Due 31 August 2021 - What You Need to Know
/Provisional tax is due again end of August 2021. This is the first provisional tax for individuals that are required to submit provisional tax, and companies that have a February year end.
Please note that if we have not received your information by 12 noon on the 31st of August, we will be unable to submit your return. This is only to ensure we get your return submitted in time and calculated correctly
Kindly please send us your provisional tax information before the end of August to avoid penalties and interest.
You will know if you are registered by either:
Asking your tax-practitioner
Phoning SARS on 0800 00 7277
On your latest tax assessment, you will see a “Y” next to “registered as provisional taxpayer”
If you are a company or closed corporation, you are most definitely registered for provisional tax
Who should be registered as a provisional taxpayer?
Employees earning any other income except salary, i.e., rental income, drawings from a business, business income, consulting income, interest income, dividend income, capital gains etc.
Any person that SARS says is registered
All companies and closed corporations
What is provisional tax?
Provisional tax is a separate form of tax.
It is like PAYE in the sense that you pay tax on income earned before you submit your income tax return. You must submit two returns during the tax year, the first one by the end of August and the second by the end of February.
Therefore, for the 2022 income tax period your initial provisional tax submission is due at the end of August 2021. The second is then due at the end of February 2022.
How do I calculate my first provisional tax?
You start by calculating the expected taxable income for the 2022 income tax period. You can use actual amounts over the period, or you can use the 2021 actual taxable income and adjust it for expected change in the 2022 income tax period.
After you have calculated the taxable income for 2022, you then calculate the tax payable on this income and deduct the PAYE and/or withholding tax already paid. This should then be divided by two to give you the six-month result. This amount needs to be paid by the 31st of August 2021.
Please don’t hesitate to phone or contact us if you have any queries or if you need us to assist you.
What we will need to calculate your provisional tax:
If you are a company or business, we require your expected income and expenses for the first 6 months of your financial year as well as your expected results for the full 12 months of the financial year.
If you are an individual who earns an income from various sources, we’ll need all supporting documentation and expected income and expenses for the first 6 months of the financial year as well as the expected income and expenses for the full 12 months of the financial year.
Contact us if you need any help with your provisional tax!
