Income Tax Made Simple – Know Your Calculations

(Last Updated On: August 21, 2018)


In this income tax made simple – know your calculations post, we learn how the calculations for your provisional tax are made.  I have simplified the calculations and advise you what you can check to ensure that the figures submitted to SARS by your tax practitioner are correct.

Income tax made simple

Third Provisional Payment :

Because your second provisional tax submission has to be in at the end of February, you might not have had the exact figure available when your tax practitioner requested your figures. This would have been sometime in January or even before then. If you earned additional income during the period you gave your figures to your tax practitioner and the end of February you will probably be liable for a third provisional tax submission.

Income tax made simple

(The above calculations are the basic framework for provisional tax payments.  It does not take into account exemptions, deductions, capital gains, medical expenses and foreign tax paid).

Statement of Accountincome tax made simple

At the end of the tax year, you can request a Statement of Account from either your tax practitioner or from SARS directly which will give you all your transaction details.  SARS will also issue your tax practitioner with a Notice of Assessment (ITA34).  This is your actual assessment (how much you have to pay). This can be requested from your tax practitioner.

In addition to an ITA34 notice a taxpayer is entitled to receive the following :

(1) An IRP5 Certificate from your employer if you are a salaried employee. This summarizes all the information contained in 12 months of payslips.  It also indicated the PAYE deductions.

(2) An IRP6 Return declaring your provisional tax if you are a provisional taxpayer.

I hope this post and the previous post (Part 1) helps you make more sense of the Income Tax system.  It’s definitely in your best interest to have an idea of how the system works as I have found out the hard way.  But more about that in a later post.

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