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Provisional tax calculations: Make sure you work yours out correctly before the end of THIS month

by , 03 February 2014
Can you believe the provisional tax deadline is already here? That's right, according to SARS, if you're a provisional tax payer, you have until the 28th of this month to submit your second period provisional tax info. That's just 25 days away. Here's what you need to remember about submitting your provisional tax during the second period and some helpful steps to calculating it correctly.

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28 February is a date you must diarise. That's when your Second Period (what you're paying for by 28 February of the following year) provisional tax is due.

During this period, you must submit:

  • Your total estimated tax for the full year;
  • Less the employees tax paid for the full year;
  • Less any allowable foreign tax credits for the full year;
  • Less the amount paid for the first period.

Here's how to work out how much you owe SARS

How to calculate your provisional tax in seven steps

The Provisional Tax 101 E-Report outlines seven steps you must use to work out your provisional tax correctly.

Step #1: Your estimated taxable income for the tax year. Remember: If it's over R1 million, you'll automatically be bounced to Tier 2.

Step #2: Calculate the amount of tax you'll pay on this income (refer to the SARS tax tables, on page 8).

Step #3: Subtract the annual tax rebate from this, (again, in the SARS tax tables). This gives you the total tax you'll have to pay for the tax year.

Step #4: Subtract half of the total tax payable for the year and you're left with the amount due for the first period of 2011 (which you'll declare and pay by 31 August).

Step #5: Subtract any employees tax deducted for this period (six months).

Step #6: Less any allowable foreign tax credits for this period (six months).

Step #7: Add any outstanding tax fines, as well as interest on this outstanding amount.

And voila! You've calculated your provisional tax!

Remember: If you end up with a negative figure, you simply enter a Nil on your IPR6 form because SARS can't process a negative amount.

Now that you know how to calculate your provisional tax, don't miss the 2014 provisional tax deadline on the 28th of February.



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