Especially for taxpayers required to make provisional tax payments on income as both individuals and as owners of companies, it may seem that a provisional or final income tax deadline lurks around every corner, with the next and crucial second payment deadline for most companies and individuals just a few short weeks away on 29 February 2024.

Given the numerous declarations and payments overlapping through the year, provisional tax is among the most confusing aspects of the tax regime, and the most heavily penalised, making professional assistance essential when attending to provisional tax responsibilities. 

 


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22A Church Street
DURBANVILLE
7550

 Tel: 021 970 4600
Fax:  021 975 6780
Email: info@sdkca.co.za
 
Website:  www.sdkca.co.za 
 

 

 

IMPORTANT TAX DEADLINES TO REMEMBER

  • 29 February 2024:Companies, Close Corporations and Trusts with February year ends 2024 tax returns
  • 29 February 2024:2024 second provisional tax estimates and payments for provisional individual taxpayers, Companies, Close Corporations and Trusts with February year ends.

2024 SECOND PROVISIONAL TAX RETURNS AND PAYMENTS DUE 29 FEBRUARY 2024

February sees the second provisional tax deadline for 2024 of all registered provisional taxpayers with February year ends.

While SDK is in the process of working with you to determine your second provisional tax payment and to ensure compliance with SARS, here are a few factors to consider:

  1. Provisional tax is not a type of tax, it should rather be seen as a pre-payment of your income tax.
  2. The second provisional tax period is generally an estimate of what you anticipate your taxable income to be in the next tax year of assessment.
  3. It is highly recommended that the taxpayer should not submit an estimate which is less than the basic amount.
  4. Payments to SARS should be made by 29 February 2024 to limit the risk of payments be deemed late.


SARS PAYMENT METHODS

Please note that SARS no longer accepts payment per cheques. Alternative payment options are the following:

  1. Electronic Transfer (EFT)
  2. Making payment at your bank using the tax statement as proof
  3. Credit push channel through E-Filing (preferred method).

How is the second provisional tax calculated?

Step 1: The total estimated taxable income for the year x the relevant tax rate = Tax payable for the whole year.

Step 2: Then the tax payable for the whole year less any payment made in first provisional tax period and other tax credits (such as employees tax, foreign tax credits and medical tax credits) are deducted from the tax amount calculated in step 1 to obtain the amount that needs to be paid to SARS by 29 February.

SARS verifications and provisional tax declarations

SARS has started to request supporting documentation for the second provisional tax declarations that have been made, mostly where the declaration is less than then basic amount. The type of supporting documentation that you should have ready should it be requested from SARS is:

  1. Current year management accounts used to calculate the estimate income
  2. Tax Computation
  3. Reasons for amounts used in declaration.

The above list is not extensive, and SARS may request any information they deem necessary to verify the declaration made.


IMPORTANT YEAR END CONSIDERATIONS TO REMEMBER – 28 FEBRUARY 2024

We would like to remind you of the following aspects relating to February year-end entities and all individuals.  

Companies and Close Corporations:

Dividend Declarations:

Consider whether a year-end dividend should be declared as these dividends should be declared by 29 February 2024.

Contact us to assist you with any calculations and preparation of dividend resolutions and dividend withholding tax returns.

Individuals:

Travel allowance:

Employees in receipt of a travel allowance must maintain a logbook of business and private travel. No deduction for income tax purposes will be considered without a valid logbook. A logbook must include date of travel, destination, reason for travel and the business kilometres travelled.

Remember to record your closing kilometres (ODO reading) as at 29 February 2024.

Bank account balances:

Remember to document and send us the closing balance of your bank account(s) as at 29 February 2024.

 
     
 
February 2024 NEWSLETTER
Provisional Tax: Are You Ready for the Crucial 29 February Deadline?

Especially for taxpayers required to make provisional tax payments on income as both individuals and as owners of companies, it may seem that a provisional or final income tax deadline lurks around every corner, with the next and crucial second payment deadline for most companies and individuals just a few short weeks away on 29 February 2024.

Given the numerous declarations and payments overlapping through the year, provisional tax is among the most confusing aspects of the tax regime, and the most heavily penalised, making professional assistance essential when attending to provisional tax responsibilities. 

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Finance Minister Enoch Godongwana has invited the public to share suggestions on the 2024 Budget he is expected to deliver on Wednesday 21 February 2024.

 

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Your Tax Deadlines for February 2024
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Disclaimer

The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.


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