Between year-end deadlines and the December break, crypto is easy to ignore, until SARS doesn’t ignore it.

If you’re a South African provisional taxpayer who trades, stakes, farms, or flips cryptocurrencies or NFTs, your crypto activity from 1 March 2025 to 28 February 2026 forms part of your 2026 year of assessment. Your second provisional payment due in February 2026 must already reflect that income, or you risk penalties, interest and, in serious cases, criminal consequences.

This article explains how SARS treats crypto, what qualifies as a taxable event, and how this affects your February 2026 provisional tax.

Before we get into the details, it’s worth noting that TaxTim guides you through your tax return, but crypto gains need to be calculated separately. If you need help with crypto calculations, click here to see what you’ll need and where to get support.

1. Why February 2026 matters if you’re in crypto

South African taxpayers with significant non-salary income, including crypto, generally fall into the provisional tax system. Provisional tax is not a separate tax. It is a pay-as-you-go mechanism to prevent large tax surprises when your ITR12 is assessed.

For individuals with a February year-end:

• 1st provisional payment: last working day of August 2025
• 2nd provisional payment: last working day of February 2026
• 3rd voluntary top-up payment: usually by 30 September 2026

SARS expects your provisional income estimate to be reasonably accurate:

• If taxable income is R1 million or less, the estimate must be at least 90% of actual taxable income.
• If taxable income exceeds R1 million, the estimate must be at least 80%.

Falling short can trigger a 20% underestimation penalty, plus 10% late-payment penalties and interest.

If your crypto is excluded from your provisional estimate, you are inviting a penalty.

2. How SARS views crypto in 2025/26

SARS applies normal income tax rules to crypto assets. There is no special exemption regime.

• Crypto is an asset, not a currency. Gains may be capital or revenue in nature.
• Crypto is taxable when disposed of or earned, including swaps and rewards.

Effective tax rates:

• Capital gains on crypto: up to 18% effective rate.
• Crypto income: taxed at marginal rates, up to 45%.

SARS has confirmed that crypto forms part of its compliance programmes and that data is being obtained from exchanges and regulators.

SARS can increasingly see your crypto activity, even if you never convert to rand.

3. Which crypto events affect your February 2026 provisional estimate?

All taxable crypto activity between 1 March 2025 and 28 February 2026 must be considered.

3.1 Disposals and swaps

• Selling crypto for rand
• Swapping one token for another
• Spending crypto
• Donating or gifting crypto

Each disposal compares:

• Proceeds at fair market value in rand
• Cost base, including fees

SARS generally expects FIFO to be used unless another method is defensible.

Not taxable: Transfers between wallets or exchanges you personally own.

3.2 Staking, yield, DeFi interest and airdrops

Crypto earned rather than bought is treated as ordinary income:

• Staking rewards
• Yield farming rewards
• DeFi interest
• Mining rewards and many airdrops

1. Income is recognised at rand value on receipt.
2. This value becomes the cost base for future disposal.

3.3 NFTs

NFTs are treated as crypto assets. Gains are capital or revenue depending on behaviour.

• Buying with rand is not taxable.
• Selling, swapping, or using an NFT is taxable.

4. Consequences of leaving crypto out of your provisional tax

4.1 Provisional tax penalties

SARS may apply a 20% underestimation penalty, plus interest and late-payment penalties.

4.2 Understatement and admin penalties

Understatement penalties can reach up to 200% of the tax shortfall in severe cases.

4.3 Criminal exposure

Willful non-compliance can result in fines or imprisonment of up to two years.

5. What you should do before the December break

1. Compile transaction data
2. Classify activity
3. Estimate gains and income
4. Update your provisional estimate
5. Plan for a possible top-up payment

TaxTim guides you through your tax return, but we do not calculate crypto gains for you. If your crypto activity is more complex, you may need additional help to make sure everything is calculated correctly and ready for filing.

Thankfully, you’re covered.

On this page, we explain how crypto calculations work, what you need to prepare, and the next steps if you want specialist support.

Need help with your Crypto Calculations?