Written by Nicci
Posted 7 May 2025
Deemed annuities are regular payments made by the trust to a beneficiary that are treated as taxable income, even though they are not from a formal annuity policy.
SARS sees these fixed or regular trust payments as income (like a salary or pension), and the beneficiary must pay tax on them.
Written by Nicci
Posted 7 May 2025
A trust is a legal arrangement where a person or people (called the trustees) manage money, assets, or property for the benefit of others (called the beneficiaries).
It is often used to protect family wealth and provide for children or dependents.
The income in a trust is taxed at 45%. If income is distributed to beneficia...
Written by Nicci
Posted 7 May 2025
A beneficiary is a person or entity who receives income or assets from a trust, estate, retirement fund or life insurance fund.
In a trust, income distributed to beneficiaries is usually taxed in the hands of the beneficiary, not the trust (based on the “conduit principle”).
In the case of an estate, the estate pays tax before the inheritance is passed on, so the beneficiary usually ...
Written by Alicia
Updated 7 May 2025
A deemed dividend from a trust is when a company pays money to a trust, and that payment is treated as if it were a dividend, even though no formal dividend was declared.
It usually applies when a trust connected to company shareholders receives a benefit from the company. SARS treats it as if the company paid a dividend to the shareholder.
This happens in s...
Written by Alicia
Posted 6 May 2025
A local capital gain is a a profit made on the sale of any local asset such as a property (primary residence or rental property), shares (listed or unlisted), unit trusts or cryptocurrencies.
A profit is made when you sell the asset for more than you paid for it.
A capital loss is a loss incurred on the sale of an asset such as a property (primary residence or rental property), shares (listed or unlisted), unit trusts or cryptocurrencies.
A loss is made when you sell t...
Written by Alicia
Posted 6 May 2025
A tax directive is another word for an instruction issued by SARS to an employer or a fund telling them how much tax they should deduct from your income. Each tax directive has a special number (tax directive number) which links the lump sum you received to the tax that the company deducted.
Written by Nicci
Posted 6 May 2025
The CIPC stands for the Companies and Intellectual Property Commission in South Africa.
It is a government agency under the Department of Trade, Industry and Competition (DTIC), responsible for:
Company Registration:
Registering new companies (e.g. private, public, non-profit)
Maintenance of Company Records:
Written by Nicci
Posted 5 May 2025
Written by Nicci
Posted 30 April 2025
Net capital is the value of your business after subtracting what you owe (liabilities) from what you own (assets). It shows your business’s financial strength.
Example:
Let’s say you run a small clothing boutique in Cape Town. You have:
Written by Nicci
Posted 30 April 2025
Shares represent ownership in a company. When you buy shares, you become a shareholder — meaning you own a small part of that company. Companies issue shares to raise money, and in return, investors get a chance to benefit from the company’s growth and profits.
There are two main ways to make money from shares:
Written by Nicci
Posted 30 April 2025
A bond is essentially a loan you give to a company, a municipality, or the government. It is a type of investment. When you buy a bond, you are lending money—and in return, they pay you interest as income and promise to pay back the original amount (called the capital) at a fixed date in the future.
Important: an "investment bond" is not to be confused with a "mortgage bond", which you...
Written by Nicci
Posted 29 April 2025
A foreign dividend is a payment made by a foreign company to you because you own shares in the foreign company. It’s a way for the company to share its profits with you.
In most cases, if a taxpayer holds less than 10% of the shares and voting rights in a foreign company, the foreign dividend received is taxable. The full amount must be declared in the tax return, but SARS allows a partial exemption, meani...
Written by Nicci
Updated 24 April 2025
COMPANY LETTERHEAD
Date
Employee's Full Name
Address
To Whom It May Concern,
Subject: Confirmation of foreign employment
This letter serves to confirm that____________________________(Name of employee) _______________________(ID number) is employed by __________________________(company name) in the capacity of__________________________(position).
He/she is contracted to work overseas in _______________ (country) from ______________dd/mm/yy to ________________dd/mm/yy. ...
Written by Nicci
Posted 24 April 2025
There is a section on the ITR12 tax return that asks you to indicate any periods during the tax year when you were not working (i.e., were unemployed).
This section applies only to South African tax residents who are salaried employees and receive an IRP5.
...
Written by Alicia
Posted 24 April 2025
Written by Alicia
Posted 24 April 2025
Written by Nicci
Updated 23 April 2025
1. How many returns should I file each year if I am a provisional taxpayer?
You are required to file 3 returns i.e. 2 provisional tax returns (IRP6s) and one annual return (ITR12). The reason you need to file the annual return, too, is that your provisional returns are based on an estimate of your taxable income, while the annual return reflects your actual taxable income. Any provisional payments you have made for the year will be deducted from your final tax liability, which is calculated when you submit your annual tax return for assessment.
2...
Written by Alicia
Updated 22 April 2025
Provisional tax can be confusing, especially when it comes to the timing of payments. If you miss the first payment, do you need to catch it up, or can you just pay the second one? And what happens if you become a provisional taxpayer halfway through the year - are you still expected to file a first provisional tax return? In this post, we’ll attempt to clear up the confusion around first and second provisional tax payments.
Brief summary
Written by Alicia
Updated 22 April 2025
TaxTim uses the financial information which you entered to work out the payment due on your provisional tax return (also called an IRP6). However, there may be some information we don’t have access to, which won’t be included in the estimate of your provisional tax payment. To see what SARS has on record, you will need to request a Provisio...
Written by Alicia
Updated 22 April 2025
During the final days of the provisional tax season, high traffic volumes may cause delays in submitting provisional tax returns to SARS—even after you've clicked 'submit' on our website.
To avoid late payment penalties, we recommend paying the estimated provisional tax amount shown on our website. Once your provisional tax return (IRP6) appears in eFiling and your SARS provisional Statement o...
Written by Elani
Updated 22 April 2025
You can Register yourself for provisional tax in a few quick steps on your eFiling profile:
Go to www.sarsefiling.co.za
Type in your unique username and password – you will have decided on these when you registered for eFiling.
Didn’t register yet to eFile? Please refer to our
Written by Patrick
Updated 22 April 2025
Written by Patrick
Updated 22 April 2025
If you earn income from renting out a property, or even subletting a room in your home, you need to pay tax on it...
Written by Neo
Updated 16 April 2025
Surely most of us love to travel, but traveling for business purposes is no fun when it comes to completing your tax return.
SARS has some rather onerous requirements, but as long as you know what you need, submitting your documents to SARS should be plain sailing.
Read more →
Written by Neo
Updated 16 April 2025
Travel expenses and their tax impact are a complex issue for many. It’s no surprise that it’s a common theme on our Helpdesk.
Read more →
