Rates of Tax
0 – 150 000: 18% of taxable income
150 001 – 235 000: R 27 000 + 25% of the amount above R150 000
235 001 – 325 000: R 48 250 + 30% of the amount above R235 000
325 001 – 455 000: R 75 250 + 35% of the amount above R325 000
455 001 – 580 000: R 120 750 + 38% of the amount above R455 000
580 001 and above: R 168 250 + 40% of the amount above R580 000
Medical & Physical Disability Expenses
Taxpayers 65 and older may claim all qualifying expenditure. Taxpayers under 65 are not taxed on, or may deduct, monthly contributions to medical schemes up to R720 for each of the first two dependants on their medical scheme and R440 for each additional dependant. In addition, they can claim a deduction for medical scheme contributions above the caps and any other medical expenses limited to the amount which exceeds 7.5 % of taxable income. Taxpayers under 65 may claim all qualifying medical expenses, where the taxpayer or the taxpayer’s spouse or child is a handicapped person.
Subsistence Allowance and Advances
Where the recipient is obliged to spend at least one night away from his/her usual place of residence on business and the accommodation to which that allowance or advance relates is in the Republic and the allowance or advance is paid or granted to pay for:
- Meals and incidental costs, and amount of R286 per day is deemed to have been expended;
- Incidental costs only, an amount of R88 for each day which falls within the period is deemed to have been expended.
Where the accommodation to which that allowance or advance relates is outside the Republic, a specific amount per country is deemed to have been expended (see SARS table).
Type of Company / Organisation 2011 / 2012 Percentage
Companies and Closed Corporations: 28%
Employment Companies (Personal Service Providers): 33%
Branch Profits Tax (Foreign Resident Companies): 33%
Small Businesses
First R59 750 of taxable income – 0%
R59 751 to 300 000 of taxable income – 10% of the amount above R59 750
R300 001 and above of taxable income – R24 025 + 28% of the amount above 300 000
Travel Allowances
80% of the travelling allowance must be included in the employee’s remuneration for the purposes of calculating PAYE. The percentage is reduced to 20% if the employer is satisfied that at least 80% of the use of the motor vehicle for the tax year will be for business purposes. No fuel cost may be claimed if the employee has not borne the full cost of fuel used in the vehicle and no maintenance cost may be claimed if the employee has not borne the full cost of maintaining the vehicle (e.g. if the vehicle is the subject of a maintenance plan). The fixed cost must be reduced on a pro-rata basis if the vehicle is used for business purposes for less than a full year.
The actual distance travelled during a tax year and the distance travelled for business purposes substantiated by a log book are used to determine the costs which may be claimed against a travelling allowance.
Alternatively:
Where the distance travelled for business purposes does not exceed 8 000 kilometres per annum, no tax is payable on an allowance paid by an employer to an employee up to the rate of 305 cents per kilometre, regardless of the value of the vehicle. This alternative is not available if other compensation in the form of an allowance or reimbursement is received from the employer in respect of the vehicle.
Employer-owned Vehicles
The taxable value is 3.5% of the determined value (the cash cost including VAT) per month of each vehicle. Where the vehicle is the subject of a maintenance plan at the time that the employer acquired the vehicle the taxable value is 3.25% of the determined value. 80% of the fringe benefit must be included in the employee’s remuneration for the purposes of calculating PAYE. The percentage is reduced to 20% if the employer is satisfied that at least 80% of the use of the motor vehicle for the tax year will be for business purposes. On assessment the fringe benefit for the tax year is reduced by the ratio of the distance travelled for business purposes substantiated by a log book divided by the actual distance travelled during the tax year. On assessment further relief is available for the cost of licence, insurance, maintenance and fuel for private travel if the full cost thereof has been borne by the employee and if the distance travelled for private purposes is substantiated by a log book.
Transfer Duty
Transfer duty is payable at the following rate on transactions, which are not subject to VAT.
Acquisitions of property by natural persons:
Value of Property (R) Rate
0 – 600 000: 0%
600 001 – 1 000 000: 3% of the value above R600 000
1 000 001 – 1 500 000: R12 000 + 5% of the value exceeding R1 000 000
1 500 001 and above: R37 000 + 8% of the value exceeding R1 500 000
Acquisitions of property by persons other than natural person: 8% of the value.
If you have any questions regarding the budget please contact Dave Beattie on 031 582 7410 or [email protected].