Provisional Tax Time: First Payment for 2027 Tax Year Due 31 Aug
“Provisional tax is merely an advance payment of a taxpayer’s normal tax liability.” (SARS)
For many taxpayers, it feels as if you’re making income tax payments all the time.
It’s not far from the truth because, in South Africa, provisional taxpayers make two compulsory payments (and possibly a third voluntary payment) each year. And that’s even before the annual income tax deadline in January of the following year, when any further tax liability will become due.
As a result, there are numerous deadlines that overlap across tax years. Yes: it is confusing, as the table below illustrates. But there’s no point throwing your arms up in the air: provisional tax non-compliance is met with some of the harshest penalties imposed by SARS.
Provisional and income tax timelines
Who are ‘provisional taxpayers’?
- All companies except those specifically excluded
- Any person who earns income which is not remuneration, an allowance or advance or who earns remuneration from an employer not registered for employees’ tax except those specifically excluded
- A labour broker with an exemption certificate
- Any person notified by the Commissioner of SARS
Why must provisional tax be paid?
Provisional tax payments are like instalments on taxpayers’ annual income tax, paid in advance and spread over two or three payments during the year. These payments are deducted against any tax owing after the year’s final income tax return is filed – at which point any further tax liability will then become due.
The objective is to prevent taxpayers from facing large income tax liabilities that are only revealed at the end of the year of assessment.
How is provisional tax declared and paid?
- Provisional tax payments are calculated on estimated taxable income, including current taxable capital gains, for that particular year of assessment.
- The estimates, says SARS, must be determined sensibly and by careful reasoning and judgment, in a mathematical manner, and using experience, common sense and all available information.
- The first period estimate is forward-looking, requiring companies to estimate their taxable income for the year ahead and then to pay tax on this estimate in advance.
- In contrast, the second period provisional return is retrospective, since by the year-end there is more certainty regarding the income for the year, and the tax due thereon.
- These estimates of taxable income are submitted to SARS on an IRP6 return, which must be submitted by all provisional taxpayers for the first and second periods.
- Even if you or your company owes no tax, a ‘nil’ return showing taxable income is equal to zero must still be filed on time.
- If an IRP6 is filed more than four months after the deadline, SARS considers a ‘nil’ return to have been submitted, and unless the actual taxable income is really zero, this will result in penalties.
- Accurate records of all the calculations and source documents used must be kept as SARS can ask for the estimate to be justified and, if dissatisfied with the amount, increase the estimate.
Your Tax Deadlines for July 2026
- 07 July: PAYE submissions and payments
- 24 July: VAT manual submissions and payments
- 30 July: Excise duty payments
- 31 July:
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- VAT electronic submissions and payments
- CIT Provisional Tax payments where applicable
Mandela Day: Why Younger Consumers Support Purpose-Driven Businesses
“The bottom line is that having a purpose is good business. It is the business of the future.” (Brian Whipple, former CEO of Accenture Song)
In 2026, Gen Z and Millennials are beginning to take their place as the dominant purchasing generations. It’s a significant moment as these two generations do things differently to those that came before. Millennials established the trend, choosing to focus on values-led purchasing, driven by a preference for transparency, and a willingness to hold brands to account. Gen Z has taken it further still, treating consumption as activism.
According to McKinsey & Company, nearly 70 percent of respondents say that a brand’s social and ethical values directly influence their purchasing decisions. This deepening sense that spending choices carry moral weight, a trend known as “charitable identity”, has created a consumer bloc unlike any that has come before it. For small business owners and entrepreneurs, understanding this shift is about to become essential for future earnings.
Identity is the new loyalty
For older generations, brand loyalty was largely built on reliability and price. For younger consumers, the framework is entirely different: brands are worn like values on a sleeve. Research from the 2024 Edelman Trust Barometer confirms that Gen Z uses brand affiliation as a form of social signalling. It’s a way of communicating who they are, and who they are not. This means that choosing to buy from a brand is less about the product and more about the statement. A clothing label with verified ethical supply chains, a bank that invests in community lending, or a coffee company that pays fair-trade premiums: these are all brands that allow the purchaser to feel that their money is doing something meaningful. In this sense, purpose-driven brands have become a form of charitable giving. The consumer simultaneously acquires a product and signals support for a cause.
Where ethical business meets charitable identity
Perhaps the most nuanced dimension of this trend is the ever-blurring line between consumption and philanthropy. For many younger consumers, donating to a cause and buying from a purpose-aligned brand are not distinct activities. They occupy the same emotional register: both feel like acts of conviction.
This overlap between consumption and charitable intent is transforming the way small businesses can position themselves: a clear social mission is also a business goal. If you have not made space in your annual budgets for your social mission, this must be rectified as soon as possible. You need to decide just what you stand for, and how much you can afford to invest in this aspect of your business. As your accountants, we can help you with this.
What this means for Mandela Day
Getting involved in initiatives like Mandela Day is no longer a purely philanthropic choice. And, interestingly, small businesses have an advantage over big ones. While a large corporation can sponsor a global cause at arm’s length, a small business can muck in at a local level. From supporting the local school’s sports team, volunteering at a food bank, or committing a percentage of monthly sales to a neighbourhood cause, it’s all about making your values visible to your immediate community.
Regular and authentic charitable activity generates word-of-mouth referrals that no advertising budget can replicate. It earns coverage in local and trade media, and produces social media content that resonates precisely because it is real. It also builds internal loyalty, as employees who feel proud of where they work are more motivated and less likely to leave.
The key piece, however, is alignment. Charitable activity that feels disconnected from your business’s identity will stick out to a generation trained to detect inauthenticity at a glance. A legal firm that mentors disadvantaged youth, an accountancy practice that runs free financial literacy workshops, a café that donates unsold food to a local shelter: these are acts of giving that simultaneously tell a coherent story about who you are and what you stand for.
The practical formula is straightforward: choose causes your team genuinely cares about, build long-term partnerships rather than one-off gestures, communicate them consistently across your channels, and track the outcome not only in goodwill but in customer retention and referral rates. What you choose to do for Mandela Day is a valuable part of your brand, not just an excuse to get out of the office.
