Our SARS Small Business Income Tax Calculator works out the income tax payable on your company's taxable profit using the reduced Small Business Corporation (SBC) tax rates for the 2027 tax year (2026/2027). Qualifying SBCs pay 0% on the first R99,000 of taxable income and a sliding scale thereafter, far less than the flat 27% company rate. Enter your financial year-end period and taxable income to see your tax and profit after tax instantly.
An SBC is taxed under section 12E of the Income Tax Act on a progressive scale instead of the flat 27% corporate rate. The calculator finds the bracket your taxable income (gross income less allowable deductions) falls into for your financial year-end period, then applies that bracket's base amount plus marginal rate on the excess. SBC rates run on years of assessment ending between 1 April and 31 March, so you select the period your year-end falls within rather than a calendar tax year. To qualify under section 12E, all shareholders must be natural persons holding no other company shares (listed shares aside), gross income must not exceed R20 million, and no more than 20% of total receipts may come from investment income or personal service. SBCs also enjoy accelerated section 12E asset write-offs (100% on manufacturing plant, 50/30/20 over three years on other assets). If you don't qualify, use the standard 27% company rate instead.
SBC tax rates for financial years ending 1 April 2026 to 31 March 2027 (2027 tax year)
| Taxable income | Tax payable |
|---|---|
| R0 – R99,000 | 0% |
| R99,001 – R365,000 | 7% of the amount above R99,000 |
| R365,001 – R550,000 | R18,620 + 21% of the amount above R365,000 |
| R550,001 and above | R57,470 + 27% of the amount above R550,000 |
Prior year for comparison, financial years ending 1 April 2025 to 31 March 2026 (2026 tax year):
Standard company tax rate (non-SBC): 27% of taxable income.
SBC qualifying tests (s12E): all shareholders/members are natural persons; no shares held in other companies (bar listed shares and a few exceptions); gross income ≤ R20 million; investment income plus personal-service income ≤ 20% of total receipts and accruals; not a personal service provider.
Example (2027 tax year, year-end within 1 Apr 2026 – 31 Mar 2027): An SBC has taxable income of R400,000. This falls in the R365,001 – R550,000 bracket, so tax = R18,620 + 21% × (R400,000 − R365,000) = R18,620 + R7,350 = R25,970. Profit after tax = R400,000 − R25,970 = R374,030. By comparison, a non-qualifying company at the flat 27% rate would pay R400,000 × 27% = R108,000, so SBC status saves about R82,030 on the same profit.
An SBC is a company or close corporation that meets the section 12E tests and so pays income tax on a reduced progressive scale instead of the flat 27% company rate. All shareholders must be natural persons, gross income must be R20 million or less, and no more than 20% of receipts may be investment or personal-service income.
A qualifying SBC pays 0% on the first R99,000 of taxable income for the 2027 tax year, then 7%, 21% and 27% on higher bands. A company that does not qualify pays a flat 27% on all taxable income. The calculator applies the correct SBC bracket to your taxable profit automatically.
You qualify under section 12E if all shareholders are natural persons holding no other company shares (listed shares excepted), gross income is R20 million or less, no more than 20% of receipts come from investment income or personal services, and you are not a personal service provider. Sole proprietors are taxed as individuals, not SBCs.
SBC rates apply to years of assessment ending between 1 April and 31 March. Pick the period your company's financial year-end falls within. For example, a 28 February 2027 year-end falls within the 1 April 2026 – 31 March 2027 period and uses the 2027 tax-year rates.
Normal company tax is a flat 27% on all taxable income. SBC tax under section 12E uses a progressive scale starting at 0%, so small companies pay significantly less, especially on the first R550,000 of profit. SBCs also get accelerated asset write-offs not available to ordinary companies.
This calculator gives an accurate estimate of income tax on the taxable income you enter using the official SBC rates. Your final SARS assessment depends on confirmed deductions, allowances and any provisional tax already paid. TaxTim can help you complete and file the company ITR14 correctly.
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