If you earn income other than a salary, whether through a business, rental income, freelance work, investments, or any trade, it is essential to understand your tax obligations as a provisional taxpayer and ensure that all IRP6 (provisional tax return) submissions and payments meet the South African Revenue Service’s (SARS) final deadline of 28 February 2026.
What Is Provisional Tax?
Provisional tax applies to individuals who receive income that is not taxed through the traditional PAYE system. Because this income does not flow through an employer payroll, SARS requires affected taxpayers to submit two IRP6 returns and make payments during the year instead of settling a large amount in one payment at tax year-end.
SARS data shows more than 543 000 provisional taxpayers filed returns in 2024.
How Provisional Tax Payments Work
The first IRP6 return and provisional payment was due on 30 August 2025, which would have amounted to half of the total estimated tax for the full year. The second submission and payment are due for settlement on 28 February 2026 which amounts to the total estimated tax for the full year less the amount paid for the first provisional period.
This deadline should not be confused with the 19 January 2026 deadline, which applies to the submission of the final annual income tax return for reconciliation purposes.
Who Is Exempt from Provisional Tax?
Not all individuals with additional income are automatically regarded as provisional taxpayers. Natural persons who do not carry on a business are exempt from provisional tax if all their taxable income (including traditional employment income, investment income) falls below the annual tax threshold. For the 2025 tax year, the thresholds are:
- Under 65 years: R95 750.00
- 65 years and older, but under 75 years: R148 217.00
- 75 years and older: R165 689.00
Your Responsibility and SARS’ Powers When it Comes to Estimates
SARS is clear in its Comprehensive Guide to the Income Tax Return for Individuals: “Provisional tax is not a separate tax from income tax. It is a method of paying the income tax liability in advance, to ensure that the taxpayer does not have a large tax debt on assessment.” In other words, provisional tax exists to help taxpayers manage their cash flow and avoid a sudden, unexpected tax bill at the end of the year.
This system comes with responsibilities. If a provisional taxpayer fails to submit their final provisional tax return within four months after the end of the year of assessment, SARS will automatically treat this as an estimate of nil taxable income. Moreover, if the Commissioner believes the taxpayer’s estimate is unrealistic or understated, SARS has the authority to increase the estimate. And if no estimate is made at all, including cases where the taxpayer fails to file their IRP6 returns, the Commissioner may unilaterally determine the taxpayer’s taxable income based on available information.
Continued non-compliance may escalate to collection actions, including final demands, third-party appointments, or legal proceedings.
Why Accuracy Matters: The Risk of Underestimating Income
Provisional taxpayers must be aware of the risks of miscalculation, omission, or delay which may lead to penalties and interest.
It is important to note that SARS does not tax each income source separately but calculates tax on your total combined taxable income in the year of assessment. All income is added together before applying the tax tables.
Here is an example:
- Salary income: R1 700 000
- Freelance income: R120 000
Total combined taxable income: R1 700 000 + R120 000 + R80 000
= R1 900 000
Because the total exceeds R1 817 000, the taxpayer moves into the 45% tax bracket.
Impact of combining income
If the taxpayer earned only the salary of R1 700 000, they would remain in the 41% tax bracket for part of their income. However, once the freelance and rental income are added the combined income pushes them into a higher bracket. This means the portion above R1 817 000 is now taxed at 45%, resulting in higher tax than if each income stream were taxed separately.
Penalties and Interest for Non-Compliance
Missing provisional tax submission deadlines or failing to file the required IRP6 returns exposes taxpayers to substantial administrative penalties and interest, both of which accrue from the due date until the outstanding amount is fully settled. In many cases, the interest charged under section 89quat can exceed the original provisional tax liability.
| Type of Non-Compliance |
What SARS Charges |
| Late payment of provisional tax |
10% penalty on the unpaid amount |
| Interest on late payment |
Interest at prescribed rate on outstanding amount |
| Under-estimation penalty (second period) |
20% penalty on the shortfall |
| Late submission of IRP6 (administrative) |
Administrative non-compliance penalties |
Source: South African Revenue Service (SARS) – Income Tax Act, 58 of 1962 (including sections 89bis and 89quat)
Do Not Leave Your Tax Compliance to Chance
Provisional tax is not merely a SARS requirement; it is an essential element for anyone earning income outside traditional employment above set SARS thresholds.
Early in 2025, when releasing preliminary figures on the 2024-2025 Filing Season, SARS said: “There is general increase in the number of provisional taxpayers and trusts filing returns. This is encouraging, however there is still a long way to go to ensure acceptable levels of compliance in these categories of taxpayers.”
The message is clear: By filing accurate estimates and submitting your returns on time you stay compliant, avoid unnecessary charges, prevent unpleasant surprises, and maintain control over your cash flow.
If you are uncertain about your calculations or need assistance with your final IRP6 submission only a few weeks away, seeking timely guidance from a tax professional can provide peace of mind and safeguard your compliance.
