Provisional Tax Deadline: What SMMEs Need to Know Before 31 August
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SARS wants taxpayers to pay their taxes during the financial year they receive income. This is not much of a concern for salaried taxpayers, as employers pay taxes on their behalf on a monthly basis. However, if you don’t earn a regular salary with PAYE deductions, you may qualify as a provisional taxpayer, and you need to submit your first tax return and pay half of your annual taxes for the 2025/26 financial year by 31 August 2025.
Provisional tax isn’t a separate tax. It’s a way for SARS to collect income tax in advance from:
Companies and trusts
Freelancers, consultants, and sole proprietors
Individuals with additional income (e.g., rental or investment income)
Are you a provisional taxpayer? Read our article here and do the tests!
What Should Provisional Taxpayers Do?
A provisional taxpayer must request and submit a return (IRP6) for the first and second period even if, according to the result of the provisional tax calculation, the total amount of tax due and payable is “nil” (0). These are the deadlines for provisional tax:
First payment: end of August.
Second payment: end of February (end of tax year).
Third/top-up payment (optional): end of September (if needed to avoid penalties).
Penalties Are Costly
Fail to comply, and SARS won’t go easy:
10% penalty for late or missed submissions
20% penalty if you underpay by more than 10% of your final tax due
Daily interest charged until payment is made.
For Example:
You estimated and paid income tax of R60,000 during the financial year - including the August and February payments. But your final tax due is R100,000 (10% is R10,000). The shortfall is R40,000 resulting in more than 10% underpayment. SARS will charge:
20% penalty = R8,000
Plus interest from February to date of payment.
For more information go to the SARS website here.
