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Home>>Services for organisations>>Tax>>Company income tax>>Return for first provisional tax payment


Return for payment of provisional tax – first payment
Description | Steps to follow | Legal framework | Service standard | Cost | Forms to complete | Contact details

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 tax liability (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 due date for the payment of provisional tax for the first period is within six months from the start of the year of assessment. The first provisional tax payment must represent half of the tax liability for the full tax year.
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Steps to follow  

Note: IRP 6 returns for the first period must be submitted even if, according to your calculation, no provisional tax is payable.If the first provisional tax payment is based on an estimated taxable income that is less than the basic amount, a request and motivation should be included. The IRP 6 return for the first period now includes a space where you must motivate such a request. If SARS is not satisfied, a revised estimate may be requested.
  • Calculate provisional tax as follows for the first period:  
    • half of the total tax for the full year  
    • less the employees tax deducted for this period (6 months)  
    • less any allowable foreign tax credits for this period (6 months).
  • Make payments on the prescribed IRP6 return’s payment advice, on or before the due dates for payment. SARS will send registered provisional taxpayers the appropriate forms.
  • The following methods to effect payments to SARS are available:
    • provisional tax payments may be made at any SARS branch office, Mondays to Fridays, between 08h00 and 15h30, excluding public holidays
    • where payments are made by mail, via the bank or ATM, sufficient time for mailing or processing must be taken into account
    • 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.
  • Banking details:
    • 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.
    •  All that will be required is:
      • the client’s 19-digit payment reference number; and
      • the beneficiary ID / account number which is linked to a specific type of tax    to make payments. These details are reflected on the payment advice of the IRP 6 return.
  • Payments that do not comply with both the above-mentioned payment reference number and the beneficiary ID will not be accepted.
  • 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. For more details refer to the SARS website www.sars.gov.za

To avoid penalties and interest, make sure that IRP 6 returns are submitted to the relevant SARS branch office well before the due date for payment. This will ensure that your request is received and processed in time.

The payment advice portion of the IRP 6 return is now on a separate page. Your return can therefore be submitted separately from your payment.

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

When you submit your returns SARS aims to:

  • process and assess 80% of correctly completed and signed income tax returns within 90 working days from date of receipt during peak periods (July to February) and within 34 working days of receipt in off-peak periods (March to June)
  • process VAT and PAYE returns within 20 working days of receipt
  • process 90% of all electronically submitted export and import returns within 4 hours of receipt and within 24 hours of receipt of manual submissions.

Note: If a representative is dealing with your tax affairs, ensure that SARS is informed of the fact. This is to protect you and to ensure that SARS does not compromise your privacy and confidentiality.
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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.)

SARS will send the forms to registered provisional taxpayers. The payment advice is in each case attached to the IRP 6 return.
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Contact details
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