South African Revenue Service (SARS) updates
1. Tax Statistics and Revenue Performance
Scam Alert: Beware of “Final Demand – Debt Management” Letter
Taxpayers should be alert to a rising phishing threat - fraudsters are sending out fake PDF letters with subjects such as “LEGAL RULING SUMMON DEMAND AS AT 21 10 2025” (though the subject line may vary).
SARS Expands Oversight of Crypto Transactions
South Africa’s tax authorities are preparing to implement new reporting standards that will bring cryptocurrency transactions squarely within the formal tax net. The South African Revenue Service (SARS) has released draft regulations to adopt the Crypto-Asset Reporting Framework (CARF), developed by the Organisation for Economic Co-operation and Development (OECD), alongside updates to the Common Reporting Standard (CRS).
South Africa’s Medium-Term Budget Tabled for 12 November: What to Expect
Finance Minister Enoch Godongwana will deliver South Africa’s Medium-Term Budget Policy Statement (MTBPS) on 12 November, outlining the government’s fiscal and economic plans for the next three years. Often referred to as the “mini-budget,” the MTBPS provides a crucial update between February’s main Budget speeches, setting the tone for spending, borrowing, and reform priorities.
Treasury Eyes Foreign Pensions: What It Means for Retirees
Recent proposals from the National Treasury suggest a major shift in how foreign pensions and retirement benefits are taxed in South Africa. Currently, under Section 10(1)(gC) of the Income Tax Act, lump sums, pensions and annuities from foreign sources tied to past employment are exempt from income tax for South African residents.
VAT Modernisation SA: Guiding Businesses Through South Africa’s Real-Time VAT Transition
South Africa is on the path to a real-time VAT reporting system, with full implementation expected by 2028. This will see a shift away from periodic self-reporting toward e-invoicing and direct, automated data transmission to SARS.
Static VAT Threshold is Placing Administrative Strain on Small Businesses
South Africa’s VAT registration threshold has remained unchanged at R1 million in annual turnover since 2009. In the intervening years, inflation has eroded the real value of this threshold. If it had been adjusted annually, analysts estimate it would now be closer to R2.1 million.
SARS Relief Possible for Taxpayers
A forthcoming legislative change could offer relief to South African taxpayers, but only under stringent conditions. Under the proposed amendments in the 2025 Draft Tax Administration Laws Amendment Bill (TALAB), individuals and businesses may be allowed to suspend payment on estimated assessments issued by SARS, provided certain criteria are met.
National Treasury and SARB publish 2025 draft tax bills and regulations for comment
On 16 August 2025, National Treasury and SARS released the 2025 Draft Taxation Laws Amendment Bill (TLAB), Draft Tax Administration Laws Amendment Bill (TALAB), and revised VAT regulations for public comment. These proposals give effect to tax measures announced in the 2025 Budget Review and the May 2025 Budget Overview.
SARS Expands Auto-Assessment Program for 2025 Tax Season
The South African Revenue Service (SARS) has launched its most ambitious auto-assessment initiative to date, marking a significant shift in how taxpayers engage with the annual filing season. The 2025 rollout includes not only standard taxpayers but also provisional taxpayers and individuals who have made withdrawals under the new two-pot retirement system.
SARS Tax Case Sends Strong Message on Trust Accountability
A recent ruling by the Johannesburg Tax Court has sent a powerful warning to trustees, funders, and high-net-worth individuals: poor record-keeping and vague financial narratives will not shield you from SARS scrutiny.
SARS Launches 2025 Tax Season with Expanded Auto-Assessments and Compliance Focus
The South African Revenue Service (SARS) has officially launched the 2025 tax season, introducing a streamlined filing process and reinforcing its commitment to compliance and digital transformation.
Understanding the Tables of Interest Rates: What Taxpayers Need to Know
The South African Revenue Service (SARS) recently released updated Tables of Interest Rates, providing crucial information for individuals and businesses regarding tax obligations and financial planning. These tables outline interest rates applicable to outstanding taxes and those payable on refunds, ensuring taxpayers are informed about potential financial implications.
2025 Budget Review: Key Updates
The Minister of Finance, Mr. Enoch Godongwana, has announced that the 2025 Budget Review will be re-tabled on Wednesday, 21 May 2025. This revised budget will include the Fiscal Framework, Appropriation Bill, Division of Revenue Bill, and amendments to revenue laws. The decision follows the reversal of a proposed 0.5% increase in the Value-Added Tax (VAT) rate, which will remain at 15%.
The Institute of Race Relations Report
The Institute of Race Relations (IRR) has recently unveiled a report that underscores the substantial financial burden imposed by Broad-Based Black Economic Empowerment (BEE) premiums on South Africa. The report, titled "Cut VAT & BEE," estimates that the legitimate cost of BEE premiums in public procurement is approximately R17 billion per annum. To put this into perspective, this amount is equivalent to the cost of constructing around 42,000 kilometers of new paved roads, enough to stretch from Cape Town to Beijing and back.
Understanding the South African Budget Process: From Proposal to Parliamentary Ratification
The South African budget process is a meticulous and continuous cycle that ensures government spending aligns with the country's policy goals and objectives. This process begins with the Budget Speech and culminates in parliamentary ratification, involving several critical steps along the way.
South Africa Increases Carbon Tax to Combat Climate Change
In a significant move to bolster its climate change mitigation efforts, South Africa has announced an increase in its carbon tax. Effective from January 1, 2025, the carbon tax will rise from R190 to R236 per tonne of carbon dioxide equivalent (tCO2e). Additionally, from April 2, 2025, the carbon fuel levy will increase by 3c/litre to 14c/litre for petrol and 17c/litre for diesel, as mandated by the Carbon Tax Act of 2019.
South Africa to Increase VAT Rate in 2025
In a significant move to boost revenue, the South African government has announced a two-phase increase in the Value Added Tax (VAT) rate. The first increase of 0.5 percentage points will take effect on 1 May 2025, followed by another 0.5 percentage point increase on 1 April 2026. This decision comes after careful consideration of the potential contributions of various tax instruments, with VAT being identified as an efficient and broad-based source of revenue.
Review of the 2025 Budget Speech
The 2025 Budget Speech addressed the economic stagnation of the past decade, with GDP growth averaging less than 2%. In 2024, the economy grew by only 0.6%, and medium-term projections estimate an average growth of 1.8%. The speech emphasized the need for faster, inclusive economic growth to meet developmental goals.
SARS Reports Over 2 Million Tax Directive Applications for Savings Withdrawals
The South African Revenue Service (SARS) has announced a significant milestone in the implementation of the two-pot system, with a total of 2,664,279 applications for tax directives received to date. Of these, 2,403,379 applications have been approved, resulting in a total gross lump sum payout of R 43.42 billion.
SARS Invites Public Input on 2025 Budget
The South African Revenue Service (SARS) has issued a call for public input on the upcoming 2025 Budget. Finance Minister Enoch Godongwana will deliver the National Budget Speech in February 2025, and the government is seeking suggestions from South Africans on various budget-related topics.
How to Obtain a Tax Directive from SARS
Obtaining a tax directive from the South African Revenue Service (SARS) is a crucial step for employers, fund administrators, and insurers to ensure the correct deduction of employees' tax from lump sum payments. This process is essential for managing tax liabilities on retirement funds, severance packages, and other lump sum benefits.
2024 Tax Filing Season Updates
The South African Revenue Service (SARS) has announced key updates for the 2024 tax filing season, which commenced on July 1, 2024. This year, SARS will continue issuing auto-assessments for taxpayers with simpler tax affairs. Taxpayers are advised to check their auto-assessment status via eFiling or the SARS MobiApp, following an SMS or email notification.
Tax Implications of Withdrawing from Two-Pot Retirement System
Starting from 1 September 2024, individuals planning to withdraw from the savings pot of the Two-Pot Retirement System must be registered for tax. Unregistered individuals must complete their registration before applying to their relevant fund, as unregistered requests will be rejected by SARS.