Registered Accountants & Tax Professionals.

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Provisional tax returns are not issued automatically by SARS via SARS E-filing and relates to an interim 6-monthly tax return that is issued with relation to any income an individual taxpayer has earned during a tax year that was not taxed during said tax year. 

Trading companies, close corporations and trusts must be registered for provisional tax by default.

Provisional tax returns must be compiled and submitted by a tax specialist as the calculation pertaining thereto could be complicated and therefore an in depth understanding of the Income Tax Act of South Africa would be required.

Provisional tax returns are estimations during each 6-month period of the tax year in which a taxpayer would calculate how much income tax should have been paid for said period on income that is taxable, but was not taxed.

The estimation must at least be 90% of the actual value of taxable income reflected once the annual tax return is submitted. Therefore, provisional tax is not a separate tax category, but forms part of income tax payable in 6-monthly periods.

Non-compliance to submit the provisional tax return, or late submission and payment would lead to penalties and interest that would accrue and must be paid once the annual income tax return is assessed for said tax year according to the Tax Administration Act of South Africa (TAA).