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As we embark on a new tax year, it’s essential for taxpayers in South Africa to gear up for potential changes in tax laws and regulations. Understanding the new laws is key to staying compliant and making informed financial decisions. Let’s explore what you need to know.

Individuals

For individual taxpayers, changes in personal income tax rates, thresholds, and deductions may significantly affect financial planning and budgeting. Here are some key updates to be aware of:

  1. Tax brackets and rates: There was no inflationary relief in the personal income tax bracket, the brackets and rates remain unchanged.
  2. Threshold and rebates: The thresholds and primary, secondary and tertiary rebates have not increased.
  3. Two-pot retirement system: With effect from 1 September 2024, contributions to retirement funds will be split, with one‐third going into a “savings component” and two‐thirds going into a “retirement component”. The intention of this reform is to enable pre‐retirement access to a portion of one’s retirement assets.
Corporates

Business owners and corporations must stay informed about changes in corporate tax laws to optimize their tax planning and compliance efforts. Here’s what to look out for:

  1. Corporate rates: The corporate tax rates remain unchanged (currently 27%).
  2. Incentives: Businesses can continue to benefit from the renewable energy incentive. This incentive, expanded last year from 100% to 125%, will be in effect until February 28, 2025.
  3. International: A global minimum corporate tax at 15% which applies to large multinational groups of companies to be implemented.
  4. VAT: There are no changes to the VAT rate. The proposed changes to the VAT legislation are of a limited technical nature.

Compliance and reporting requirements

Staying compliant with laws and meeting reporting deadlines is critical for avoiding penalties and maintaining good standing with authorities. Here are some South African Revenue Service (SARS) compliance considerations:

  1. Individual filing deadlines: The filing season for individuals normally runs from July to November (for non-provisional taxpayers). The deadline for provisional taxpayers is usually January to file via eFiling.
  2. Company filing deadlines: A company is required to submit a Return of income (ITR14) within 12 months from the date on which their financial year ends. The filing and payment by companies of provisional tax (IRP6’s) are 6 months after year-end (1st period), at financial year end (2nd period) and 6 months after financial year end (3rd period).

Refer to the SARS website for the compliance deadline dates.

Conclusion

Taxpayers must stay informed about changes in tax laws and regulations. Whether you’re an individual taxpayer or a business owner understanding these changes is crucial for effective tax planning and compliance. Consulting with us can provide personalized guidance tailored to your specific needs and circumstances. Get in touch with us today.

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