Description
Where an individual earns taxable income that is not subject to
SITE or PAYE deductions (e.g. interest, rental or business income),
he or she has to pay provisional tax on this income. Provisional
tax payments are made on a six-monthly basis.
Provisional tax is intended to help taxpayers meet their tax
liabilities on an on-going basis as opposed to paying a big amount
once a year on assessment. The provisional tax paid will be offset
against the final income tax (normal tax) that the individual has
to pay for the relevant year of assessment.
A person who becomes liable for the payment of provisional tax
must, within 30 days of becoming liable, apply in writing for
registration at the local branch office of the South African
Revenue Service (SARS). Failure to do so will result in interest
and penalties being levied on late payments and additional tax for
the late submission of returns.
The third provisional payment is also known as an “additional”
or “topping-up” provisional payment. If such a payment is made, it
must be paid not later than the ‘effective’ date. The ‘effective’
date is
- in the case of the year of assessment
ending on 28 or 29 February, seven months thereafter
- for approved financial year-ends that end
on a date other than 28 or 29 February, six months
thereafter.
The third payment is a voluntary payment that any provisional
taxpayer may make. Taxpayers (other than companies) with a taxable
income of more than R50 000 or companies with a taxable income of
R20 000 or more, may make a third voluntary payment to avoid
interest being levied on any underpayment of tax on assessment.
The purpose of this payment is to enable taxpayers to pay the
difference between employees tax plus provisional tax already paid
for the year, and the total tax liability for the year of
assessment.
The third period represents the total tax payable for the full
year, less:
- the employees tax paid for the full
year
- any allowable foreign tax credits for the
full year
- the amounts paid for the first and second
provisional tax periods.
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Steps to follow
It is up to each provisional taxpayer to identify when a top-up
third payment is necessary.
Obtain the new payment advice from SARS or download it from this
site, complete it and submit it together with payment.
Because the payment advice is generic and does not carry detail
relating to a specific taxpayer, it is of the utmost importance
that provisional taxpayers enter the correct account details on
this advice. If the correct details are not entered, the payment
cannot be credited to the correct taxpayer.
The account details are made up as follows:
- The tax reference number of the
taxpayer
- P0003 – indicating the payment period
- 2005 – indicating the year of
assessment.
A typical payment reference number will thus be
1234567123P00032005.
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The following methods to effect payments to SARS
are available:
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Provisional tax payments may be made at any SARS branch office,
Mondays to Fridays, between 08h00 and 15h30, excluding public
holidays.
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Where
payments are made by mail, via the bank or ATM, sufficient time for
mailing or processing must be taken into account.
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Where
payments are done electronically, provision must be made for your
bank’s cut-off times and for a clearance period that could take
between two and five days.
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Banking details:
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Clients paying over the counter at any ABSA, FNB, or Nedbank branch
will no longer need to supply a bank account number and bank code
when making payments. This applies equally to all ABSA, FNB,
Nedbank, and Standard Bank internet banking clients.
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All
that will be required is:
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These
details are reflected on the payment advice of the IRP 6
return.
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Payments that do not comply with both the above-mentioned payment
reference number and the beneficiary ID will not be
accepted.
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If
the last day for payment falls on a public holiday or weekend, the
payment must be made on the last working day prior to the public
holiday or weekend.
Note:
The third period (voluntary) payment should be based on actual
taxable income, as the purpose of this payment is to enable you to
pay the difference between employees tax plus provisional tax
already paid for the year and the full tax liability for that tax
year.
Consult the IRP 12 Guidelines if you require assistance
in the completion of your IRP 6 return.
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Legal framework
Income Tax Act, 1962 (Act 58 of 1962) — Fourth Schedule
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Service standard
There is no set time for this service.
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Cost
The service is free.
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Forms to complete
(Forms are provided in PDF
format. To open PDF documents, you need to have
Adobe Acrobat Reader 4 or higher installed on
your computer.)
Return for the third provisional tax payment
(IRP 6)
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Contact details |