Quick Facts

• Tax filing deadline: 20 October 2025 (salaried workers)
• Tax-free earnings threshold: R95,750 per year if under 65
• Tax-free savings limit: R36,000 per year, R500,000 lifetime
• Retirement contributions save you up to 27.5% in tax
• Never pay anyone upfront for tax help – check they are SARS registered

1. Understanding Tax in South Africa

What is income tax?

Income tax is money you pay to SARS from what you earn. The South African Revenue Service (SARS) collects this money. It pays for roads, schools, hospitals, and SASSA grants.

Who must pay tax?

You must pay tax if you earn more than:

• R95,750 per year (if you are under 65 years old)
• R148,217 per year (if you are 65 to 74 years old)
• R165,689 per year (if you are 75 years or older)

How SARS gets your tax

PAYE (Pay As You Earn): If you work for a company, your employer takes tax from your salary. They send it to SARS every month. You see this deduction on your payslip.

Provisional Tax: If you own a business or work for yourself, you pay SARS twice per year. First payment by 31 August, second payment by 28 February.

2. How Much Tax You Pay in 2025

Tax brackets for 2025/2026

South Africa uses different tax rates for different income levels. The more you earn, the higher your tax rate on that extra money.

Annual Income	Tax Rate
R0 to R237,100	18% of your income
R237,101 to R370,500	R42,678 + 26% of amount over R237,100
R370,501 to R512,800	R77,362 + 31% of amount over R370,500
R512,801 to R673,000	R121,475 + 36% of amount over R512,800
R673,001 to R857,900	R179,147 + 39% of amount over R673,000
R857,901 to R1,817,000	R251,258 + 41% of amount over R857,900
R1,817,001 and above	R644,489 + 45% of amount over R1,817,000

Tax rebates reduce your tax

A tax rebate takes money off your final tax bill. These rebates apply automatically:

• Primary rebate: R17,235 for everyone
• Secondary rebate: R9,444 extra if you are 65 or older
• Tertiary rebate: R3,145 extra if you are 75 or older

Simple example

Thabo earns R300,000 per year. He is 35 years old. Here is how his tax works:

1. Tax on first R237,100 = R42,678
2. Tax on remaining R62,900 at 26% = R16,354
3. Total tax = R59,032
4. Minus primary rebate R17,235
5. Final tax = R41,797 for the year
6. This is R3,483 per month

✅ 3. Ways to Save Money on Tax

Retirement fund contributions

This is one of the best ways to save tax. When you put money into a pension fund or retirement annuity, SARS does not tax that money.

The rules:

• You can deduct up to 27.5% of your income
• Maximum deduction is R350,000 per year
• This applies to pension funds, provident funds, and retirement annuities

Example: Sarah earns R400,000 per year. She puts R60,000 into her retirement annuity. SARS only taxes her on R340,000. This saves her about R16,500 in tax for that year.

Travel allowance claims

If you use your own car for work, you can claim back some tax. You must keep a logbook showing:

• Date of each trip
• Where you went
• How many kilometres you drove
• Business purpose of the trip

Home office expenses

You can claim home office costs if:

• You do most of your work from home, OR
• More than 50% of your pay is commission

You can claim a portion of rent, electricity, rates, and internet costs.

Donations to charities

Donations to registered Public Benefit Organisations (PBOs) reduce your taxable income. You can deduct up to 10% of your income for donations.

4. Tax-Free Savings Accounts (TFSA)

What is a TFSA?

A Tax-Free Savings Account lets you save or invest money without paying tax on the growth. No tax on interest, dividends, or capital gains. No tax when you withdraw money.

The limits for 2025

• Annual limit: R36,000 per tax year (March to February)
• Lifetime limit: R500,000 total over your lifetime
• This is R3,000 per month if you save regularly

How it saves you money

Example: Nomsa puts R36,000 into a TFSA earning 8% interest. After one year, she has R38,880. The R2,880 growth is completely tax-free. If this was a normal savings account, she would pay about R800 in tax on that interest.

Where to open a TFSA

You can open a TFSA at:

• Banks: Capitec, FNB, Standard Bank, ABSA, Nedbank
• Investment companies: Allan Gray, Satrix, 10X, Old Mutual
• Unit trust providers

You can have more than one TFSA. But your total contributions cannot exceed the limits.

Important rules

Rule	What It Means
Exceed the limit	Pay 40% penalty tax on the excess amount
Withdraw money	You can take it out anytime, but it counts towards your lifetime limit
Unused annual limit	Does not roll over to next year – use it or lose it
Investment growth	Does not count towards your contribution limits

5. Medical Aid Tax Credits

How medical tax credits work

If you pay for medical aid, SARS gives you a tax credit. This reduces your tax directly. It is not the same as a deduction.

Monthly medical tax credits for 2025

• You (main member): R364 per month
• First dependant: R364 per month
• Each additional dependant: R246 per month

Example: A family of four (parents and two children) gets R1,220 tax credit per month. This is R14,640 per year saved on tax.

Additional medical expenses credit

You can claim extra tax relief for medical costs your medical aid did not cover:

If you are under 65 years old:

• You can claim 25% of expenses that exceed 7.5% of your income
• This applies after your medical aid contributions exceed 4 times the annual tax credits

If you are 65 or older, or have a disability:

• You can claim 33.3% of all excess medical expenses
• No threshold to meet – all excess expenses qualify

What medical expenses qualify?

• Doctor and dentist fees
• Prescribed medicines from a pharmacy
• Hospital and nursing care
• Physiotherapy and other registered practitioners
• Medical equipment like wheelchairs or hearing aids

Does not qualify: Over-the-counter medicines, vitamins, gym memberships.

6. Capital Gains Tax Explained

What is capital gains tax?

Capital Gains Tax (CGT) is tax on profit when you sell an asset. This includes property, shares, or unit trusts. You only pay tax on the profit, not the full selling price.

How CGT is calculated for 2025

Step 1: Calculate your capital gain = Selling price minus purchase price minus expenses

Step 2: Subtract your annual exclusion (R40,000)

Step 3: Only 40% of the remaining gain is taxed

Step 4: This amount is added to your normal income and taxed at your rate

Example calculation

Mandla sells an investment property:

• Selling price: R1,000,000
• Original purchase price: R600,000
• Improvements and costs: R100,000
• Capital gain = R1,000,000 – R600,000 – R100,000 = R300,000
• Minus annual exclusion: R300,000 – R40,000 = R260,000
• Taxable amount (40% of R260,000) = R104,000
• If Mandla is in the 39% tax bracket, he pays R40,560 CGT

Important exemptions

Asset Type	Exemption
Your primary home	First R2 million profit is tax-free
Personal items	Cars, furniture, clothing – no CGT
TFSA investments	Completely tax-free
Retirement funds	No CGT while invested
Small business (55+)	R1.8 million exemption

Costs you can include

When calculating your capital gain, you can deduct:

• Transfer duty you paid when buying
• Estate agent commission when selling
• Legal fees for the transaction
• Renovations and improvements (not repairs)
• Bond registration and cancellation fees

7. Filing Your Tax Return

Important deadlines for 2025/2026

Taxpayer Type	Deadline
Salaried employees (non-provisional)	20 October 2025 (online) / 21 October 2025 (manual)
Provisional taxpayers (self-employed)	19 January 2026
Trusts	19 January 2026
Companies	Within 12 months of financial year-end

How to register for eFiling

SARS eFiling is the online system for tax. It is free to use.

Registration steps:

1. Go to www.sarsefiling.co.za
2. Click “Register” and choose “Individual”
3. Enter your ID number and details
4. Create a username and password
5. SARS will send you an SMS with a code
6. You can now file your return online

Auto-assessments

SARS may do your tax return for you if your situation is simple. This is called auto-assessment. You will get an SMS or email telling you. Check it carefully. If it is correct, you do nothing. If it is wrong, you must make changes.

Documents you need

• IRP5 certificate from your employer
• IT3(b) certificates for interest from banks
• Medical aid tax certificate
• Retirement annuity certificate
• Receipts for claimable expenses
• Travel logbook (if claiming travel)

Penalties for late filing

SARS charges penalties if you file late. The penalty depends on your income:

• First month late: R250 penalty
• Second month: Extra R250 (total R500)
• Each month after: Another R250
• Maximum penalty can reach R16,000

🚨 8. Avoiding SARS Scams

Common SARS scams in 2025

Scammers target taxpayers during tax season. They pretend to be from SARS. They want your personal information or money.

Types of scams

1. Fake refund SMS or email

Message says you have a tax refund. It includes a link. The link goes to a fake website. The website looks like eFiling but it is not.

2. Fake debt collection

You get an email saying you owe tax. It threatens legal action. It asks you to pay into a private bank account. SARS never does this.

3. Fake audit notice

SMS says SARS is auditing your return. It asks you to click a link and provide information. This is a scam.

4. Phone call scams

Someone phones saying they are from SARS. They threaten arrest or legal action. They demand immediate payment. SARS does not phone people like this.

5. Fake tax practitioner

Someone offers to help with your tax return. They charge an upfront fee. They promise a big refund. They are not registered with SARS.

How to recognize a scam

Red Flag	What It Means
Urgency tactics	“Act now or face arrest” – This is a scam
Asks for banking details	SARS never asks for your bank password or PIN
Suspicious links	SARS does not send links in SMS or email
Payment to personal account	SARS only accepts payment to official SARS accounts
Upfront fees	Real tax practitioners charge after they do the work

What SARS will NEVER do

• Send you links to click in SMS or email
• Ask for your eFiling password or banking PIN
• Demand immediate payment over the phone
• Threaten arrest without official letters
• Ask for payment to a private bank account
• Contact you about a refund you did not apply for

How to protect yourself

1. Never click links in SMS or email claiming to be from SARS
2. Always go directly to www.sarsefiling.co.za (type it in yourself)
3. Check official SARS communications in your eFiling profile
4. Verify tax practitioners are registered at www.sars.gov.za
5. Enable two-factor authentication on eFiling
6. Never share your eFiling password with anyone

If you receive a scam

Do not respond. Do not click any links.

Report it to SARS:

• Email: [email protected]
• SARS fraud hotline: 0800 00 2877
• Forward the scam message before deleting it

✅ Tax Planning Calendar for 2025/2026

Month	What to Do
March	New tax year starts. Plan your TFSA contributions. Update eFiling details.
July	Tax season opens. Check for auto-assessment. Start gathering documents.
August	First provisional tax payment due (31 August). File early for faster refunds.
October	Tax filing deadline (20 October). Do not miss this date.
January	Deadline for provisional taxpayers (19 January). Review tax planning for new year.
February	Last chance to maximize TFSA and retirement contributions. Second provisional tax payment (28 February).

Tax Planning Checklist for 2025

Before February 2026:

• ☐ Maximize your retirement fund contribution (up to 27.5%)
• ☐ Use your full TFSA allowance (R36,000 for the year)
• ☐ Make any final charitable donations (up to 10% of income)
• ☐ Gather all tax certificates (medical aid, retirement, interest)
• ☐ Update your travel logbook if claiming car expenses

During tax season (July to October):

• ☐ Check your eFiling profile for auto-assessment
• ☐ Verify all information is correct on your return
• ☐ Claim all deductions you are entitled to
• ☐ File before the October deadline
• ☐ Keep copies of everything you submit

Year-round good habits:

• ☐ Keep all tax-related receipts organized
• ☐ Update your eFiling profile details when they change
• ☐ Review payslips monthly to check tax deductions
• ☐ Be alert for SARS scam messages – never click links
• ☐ Read SARS notifications in your eFiling profile

Important Contact Information

SARS Contact Details

General enquiries:	0800 00 7ars (0800 00 7277)
Fraud hotline:	0800 00 2877
Report scams:	[email protected]
eFiling website:	www.sarsefiling.co.za
Main website:	www.sars.gov.za

Other Helpful Contacts

• Tax Ombud: 0800 662 837 (if SARS is not helping you)
• Financial Sector Conduct Authority (FSCA): 0800 110 443
• National Consumer Commission: 0860 003 600

Tax planning is not about avoiding tax. It is about paying the correct amount and not paying more than you have to. Start planning early – do not wait until October.

Our top three tips:

1. Open a Tax-Free Savings Account and contribute regularly. Even R500 per month makes a big difference over time.
2. Put as much as you can afford into a retirement fund. You save tax now and build your future at the same time.
3. Keep good records throughout the year. Do not scramble for documents when it is time to file.

Always be suspicious of anyone promising big tax refunds or asking for upfront fees. Check that tax practitioners are registered with SARS. Never click on links in messages claiming to be from SARS.

If you need help, SARS has free walk-in centres at their branches. You can also use the SARS call centre at 0800 00 7277. They are there to help you.