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Table of Contents

  • Taxes & Accounting

The Importance of the IRP6 Tax Return

The time has once again arrived, where Sole proprietors, Business owners and Trusts are required by law to file their IRP6, provisional tax returns. And while filing tax returns, and liaising directly with SARS, may be daunting for even the most experienced business owners – the intend of this submission is to alleviate the financial pressures of a business’s taxable liabilities.

When you register a company in South Africa, you become legally responsible to file tax submissions on an annual basic to keep the company complaint.

As proof that a company is complaint with SARS, by filing their pending tax submissions, the applicant will be issued a Tax Clearance status with SARS. Which will reflect as non-compliant on the SARS eFiling portal should a submission be skipped.

What is an IRP6 Tax Return?

IRP6 Provisional Tax Returns allow for taxpayers to file tax returns twice annually and reconcile any payment due to SARS, if any. In turn, this grants business’s the opportunity to submit and pay smaller amounts more frequently throughout the year rather than a lumpsum once yearly. 

When declaring a provisional tax return, SARS will require registered companies to declare an estimate of the total taxable income for the financial year. Dormant, or inactive, companies are also required to submit all Tax Returns annually to officially declare a null return. 

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Why is it important to file the IRP6?

When filing IRP6, taxpayers are to declare figures twice annually and make payments to SARS. These amounts are then credited towards the financial year end returns. A final assessment is then done after the end of the financial year to  established if the taxpayer has under paid SARS or over paid, in which case the taxpayer will be reimbursed. Another important factor would be the company’s overall compliance and the effects on the company’s ability to trade. 

Failure to file a provisional tax return will result in a non-compliant, status on your SARS eFiling which will prevent your company from applying for tenders or even some contracts.

Failure to comply with tax submission deadlines may also lead to penalties and interest being added to your payment amount and will hinder your chances of obtaining a valid tax clearance pin certificate. Accumulating a backlog of unfiled IRP6 submissions will also result in financial strain on a company, which may be financially crippled in its efforts to bring the company back up to date on its complaint status.

When do I need to submit my Tax Returns?

Companies (trading or not) are required to submit their tax returns twice in the financial tax period, as well as a final Tax Return submission 12 month from the last day of the previous financial year end. Below are the tax deadlines for companies with :

  • Provisional Tax Return (IRP6): 6 Months from first day of the Financial year – usually August.
  • Provisional Tax Return (IRP6): On the last month of the Financial year – usually February.
  • Annual Tax Return (IT14): Within 4 – 12 months from the last day of the Financial year end – July.

Company Partners has a team of expert tax specialists to assist all South African taxpayers in maintaining their complaint tax status with SARS.

Contact us today!

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