Your Guide to our Monthly Tax Maintenance Plan in South Africa
A simple guide to Tax Maintenance throughout the year for the South African entrepreneur.
Please note this page does not serve as legal advice and it’s important to check for any regulation changes at the relevant authorities.
Tax Maintenance is hard work. You need to stay on top of various Tax Submissions throughout the year. On this page, we will walk you through a plan that’s specifically designed to simplify your business’s Tax Compliance throughout the year. Additionally, we will also answer 10 frequently asked questions on Tax Maintenance in South Africa.
First, let’s dive into our monthly Tax maintenance plan. If you have specific questions, simply scroll down to FAQs on Tax Maintenance in South Africa.
Our Tax Maintenance Plan (for only R389 per month):
● IRP 6 Provisional Income Tax Returns in August;
● IRP 6 Provisional Income Tax Returns in February;
● IT 14 Annual Income Tax Returns in July.
● Tax Clearance Renewal Pin Certificate Annually.
● Our service also includes the submission of Annual Returns at CIPC for free.
Kindly note that this service doesn’t include outstanding returns or overdue fees at the CIPC. You will need to settle these fees beforehand. If you need settlement support, we can support you at an additional fee.
It also doesn’t include the cost of your Income Tax Submissions. These costs need to be settled directly at SARS on the applicable due date.
If you are unsure or need more details, please speak to one of our Consultants.
How does our Tax Maintenance Plan work?
Once you’ve signed up, our Tax Team will send you an email requesting some basic information about your company, for example your income and expenses. In order for us to submit your documents on time, it will be your responsibility to send these details to us within 2 weeks after you’ve received our email.
Why should I sign up for a Tax Maintenance plan?
Keeping track of all your Tax submissions can be a burden. This service takes this administrative burden off your shoulders, so you can free up some time for you to solely focus on your business. It’s also a simple way to keep your company compliant and Tender-ready throughout the year.
What is an IRP 6?
The IRP 6 is a document which sums up the taxable income your company made throughout a single tax season. This value is then used to determine the tax you need to pay to SARS.
Creating an IRP 6 can be quite challenging because it needs to be precise. That’s why we’d recommend using an educated professional to generate this document. Our service includes the support of such educated professionals.
What is Provisional Tax?
Provisional Tax is a form of income tax, which addresses tax liability in advance. With Provisional Tax, SARS requires you to submit an estimation of your income and expenses, before the financial year is over. This estimation is then used to calculate a tax estimation which is payable to SARS.
If it turns out that this amount is overestimated, SARS will refund the difference to you as soon as the tax season is over. However, it’s important to accurately judge how much tax you would need to pay. If you overestimate this amount, you will have money tied up at SARS, which affects your cash flow.
Additionally, Provisional Tax is a unique form of tax, because your due payments are divided into various payments, due throughout the year.
The goal of Provisional Tax Submissions is reducing the pressure on companies and individuals who don’t have the support of a fixed employer. This is why Provisional Income Tax Submissions are due 3 times a year and preemptively; the goal is ensuring a better cash flow for your business.
Provisional Tax automatically applies to most registered companies. It also applies to partnerships and freelancers or Sole Proprietor businesses. It does not, however, apply to individuals who earn salaries from employers. These individuals pay PAYE (pay-as-you-earn) tax.
What are Tax Returns?
The process of submitting your tax payments to SARS is called Tax Returns. It is called Tax Returns because you have to return a part of the money that you have made to SARS. The payable or “returnable” amount is determined by SARS based on your annual, taxable company income.
How many times a year do you have to submit your Tax Returns?
In terms of Provisional tax submission, there are three periods in a year of assessment.
This first period is expected at the start of the tax season, normally around March of that season. This is a smaller amount (around 30%) of the provisionally calculated tax amount.
The next instalment is due in September. This is usually the bulk of the taxes due for that year (around 60%).
The last instalment is due after the season has closed. Normally, this would be the last 10% and it would be payable about 3-4 months after the season’s closure.
What is an ITR 14?
An ITR 14 is one document that reconciles all the tax contributions that you make as a company. This includes Income Tax, PAYE, SDI and/or UIF, VAT and any Customs declarations that were made after the initial income declaration.
It is important to note that this is an online form and can only be accessed and completed via SARS eFilling. However, many of our services include this form, which means our Tax Experts will walk you through the process step-by-step.
How do I complete the ITR 14 form?
After completing your tax return this document will be populated according to the company category you fall in:
● Share Block
● Body Corporate
● Micro Business ○ Revenue: <R1Mil; Assets: <R5Mil
● Small Business ○ Revenue: <R14Mil; Assets: <R10Mil
● Medium to Large Business ○ Revenue: >R14Mil; Assets: >R10Mil
Your sole responsibility is to make sure that your company details are up-to-date on the eFilling platform before you populate this document.
It’s as easy as that, but we still advise a professional eye when making sure all the details of this document is correct.
What is a Tax Clearance Renewal Pin Certificate?
The Tax Clearance Renewal Pin Certificate is an anti-fraudulent mechanism introduced, not so long ago, by SARS.
This digital certificate aims to replace the Tax Clearance certificate document. The goal of either of these documents is obtaining proof that your company is compliant with the Tax regulations that apply to your business – and in good standing with SARS.
You have to renew your Tax Clearance Certificate or your Tax Clearance Renewal Pin Certificate every time you have to submit your Tax Submissions.
The Tax Clearance Renewal Pin Certificate is very useful when a company asks about your Tax compliance. Oftentimes, before you can sign a contract with a company, they will inquire about your Tax compliance. This helps them ensure that you’re doing everything by the book and that they won’t run into non-compliance issues in the future.
Once you’ve offered a prospective client your pin, they can “live” track your compliance on SARS eFiling platform.
What are Annual Returns at the CIPC?
Every registered company is registered at the CIPC. However, in order to maintain this company registration, you need to pay an annual filing fee. This fee is calculated based on the total amount of money (sales) your company has made during the year in question. If it’s less than R1 million rand, the fee will only be R100. If it’s between 1 and 10 million rand, the fee will be R450.
In order to complete your renewal, you will need to share a summary of your financials with the CIPC. This information will be kept confidential. The CIPC officer assigned to your case will use this information to review your company registration and determine the payable renewal fee. Neglecting to pay this fee, implies penalties and eventually deregistration of your company.