Here’s What SARS Actually Expects From You.
You got your first payslip. Or your first invoice got paid. Or your side hustle finally started generating real money. Congratulations, you are now officially part of the South African tax system.
For most young earners, the reaction to that sentence is somewhere between mild panic and complete confusion. What does being part of the tax system actually mean? Do you need to do anything? Will SARS come looking for you? And how do you even start?
This article breaks it all down in plain language, so you know exactly where you stand and what steps to take.
Do You Actually Need to File a Tax Return?
The short answer is, probably yes, even if you earn very little.
For the 2025/2026 tax year, the tax threshold for individuals under 65 is R95,750 per year. This means that if you earn less than R95,750 in a year, you are not required to pay income tax. However, earning below the threshold does not automatically mean you are exempt from filing a return or from registering with SARS.
In fact, SARS requires most individuals to have a registered eFiling profile. Even if your return results in a nil amount owed or a nil amount refunded, SARS still expects you to declare your income and submit what is known as a nil return.
Failing to register or file when required can result in administrative penalties, interest charges, and complications down the line when you need a tax clearance certificate for anything from a job application to a visa.
| Key figure for 2025/2026Tax threshold for individuals under 65: R95,750 per year. Primary rebate: R17,235. Source: SARS 2025/2026 Budget Tax Tables. |
What About Auto-Assessment?
Each year, SARS issues auto-assessments to a large number of individual taxpayers. This means SARS uses the third-party data it already holds from your employer, your medical aid, your bank and your retirement fund administrator to calculate a proposed tax return on your behalf.
If you receive an auto-assessment, you have until the end of the filing season to either accept it or edit and submit your own return if you believe the figures are incorrect. Ignoring an auto-assessment is not the same as being exempt from filing. If you do nothing, SARS may treat the auto-assessment as your final return, which can result in an incorrect liability being raised against you.
Always log into eFiling or the SARS MobiApp to check whether an auto-assessment has been issued for you.
PAYE, Freelance Income and Why It Matters
There are two common earning situations for young South Africans, and each has different tax implications.
If You Are Employed and Receive a Salary
Your employer deducts Pay-As-You-Earn (PAYE) tax from your salary every month and pays it directly to SARS on your behalf. Your IRP5 certificate, which your employer must issue to you after the tax year ends on the last day of February, shows your total earnings and the total PAYE deducted.
Many salaried employees assume their tax is fully handled by their employer. This is often true for straightforward situations. However, you will likely still need to file your own return if you have any of the following:
- a medical aid contribution (qualifying for a medical tax credit)
- a retirement annuity (RA) contribution
- a travel allowance or company car benefit
- commission income
- any income earned outside of your primary employment
In these cases, your employer’s PAYE deductions may not fully account for all the deductions and credits you are entitled to, and filing your own return allows you to claim them correctly.
If You Are a Freelancer, Sole Proprietor or Independent Contractor
If you earn income from clients, contracts, platforms or your own business activity and you are not on a company payroll, you are classified as a sole proprietor for tax purposes. This applies to graphic designers, photographers, consultants, tutors, content creators, Uber and Bolt drivers, Airbnb hosts, and many others.
As a sole proprietor, nobody deducts PAYE on your behalf. You are responsible for declaring all your income and, in most cases, for making provisional tax payments during the year. All income you receive from clients, whether paid by EFT, cash, PayPal or any other method, is taxable and must be declared.
The good news is that as a sole proprietor you are also entitled to deduct legitimate business expenses from your taxable income. Qualifying deductions can include:
- home office costs (where a dedicated, exclusive space is used for work)
- the work-related portion of your phone and data costs
- equipment, software and tools used to earn your income
- business travel (documented with a logbook)
- professional services, subscriptions and stationery
Keeping accurate records and receipts throughout the year is essential. SARS may request supporting documentation during a verification or audit process.
What is Provisional Tax and Do You Need to Pay It?
Provisional tax is one of the most commonly misunderstood concepts for first-time earners, so let us explain it simply.
The South African tax system is designed so that income tax is collected throughout the year rather than in one large payment at the end. For employed individuals, this happens automatically through PAYE. For people who earn income that is not subject to PAYE, provisional tax serves the same purpose.
Provisional tax is not a separate or additional tax. It is simply a method of paying your normal income tax liability in advance, in two instalments during the tax year, so that you do not face a large, unexpected bill when you submit your annual return.
Who Qualifies as a Provisional Taxpayer?
Under the Income Tax Act of South Africa, you are a provisional taxpayer if any of the following apply:
- You earn income that is not remuneration (i.e. not a salary from an employer who deducts PAYE)
- You earn more than R30,000 per year from sources other than a single employer
- You are a director of a private company
- You are a member of a close corporation (CC)
A common example: if you earn a salary from one employer but also earn R40,000 per year from freelance work, you are a provisional taxpayer for the freelance portion of your income.
When Are Provisional Tax Payments Due?
Provisional taxpayers must make two compulsory payments during each tax year. The South African tax year for individuals runs from 1 March to the last day of February the following year.
For the 2026/2027 tax year:
- First provisional payment: due by 31 August 2026
- Second provisional payment: due by 28 February 2027
The first payment must be at least 50 percent of your estimated total tax liability for the year. The second payment must settle any remaining balance. A third optional payment is available after the tax year ends if you need to top up your payment to avoid interest.
If you significantly underestimate your taxable income and underpay on your provisional tax, SARS may impose an underestimation penalty of 20 percent on the shortfall. Getting your estimate right matters and working with a registered tax practitioner can help you do this accurately.
| Important: Provisional tax deadlines for 2026/2027First payment: 31 August 2026 (50% of estimated annual tax liability). Second payment: 28 February 2027 (remaining balance). Underestimating by more than the allowable margin can trigger a 20% penalty on the shortfall. |
How to Register on SARS eFiling
SARS eFiling is the online platform used to manage your tax affairs, submit returns, make payments and communicate with SARS. Registration is free and straightforward.
To register, visit www.sarsefiling.co.za and click on Register. You will need:
- your South African identity number
- a valid personal email address
- your South African bank account details
- your contact number
Once registered, you will receive a tax reference number which links your financial affairs to SARS. You can then use the eFiling portal or the SARS MobiApp to file returns, view your account, respond to queries and make payments.
If you have previously filed a return or if your employer has been deducting PAYE, you may already be registered. Check your status by visiting the eFiling site and selecting the option to retrieve your tax number using your ID number.
Filing Season 2026: Key Dates to Know
SARS typically opens the annual individual tax filing season in July each year. For 2026, the following dates are expected (SARS publishes confirmed dates on its website closer to the time):
- Non-provisional taxpayers (salaried employees): July to October 2026
- Provisional taxpayers: July to January 2027
- Taxpayers who are required to file via a tax practitioner: confirm deadlines with your practitioner
Late submission of a tax return can result in an administrative non-compliance penalty of R250 per month for each outstanding return, up to a maximum of R16,000 per return. These penalties are in addition to any interest charged on outstanding tax amounts.
Your Three-Step Action Plan Right Now
You do not need to wait for filing season to get organised. Here is what you should do now:
Step 1: Register on eFiling if You Have Not Already
Go to www.sarsefiling.co.za, register or log in, and confirm that your personal details, banking information and contact details are up to date. If you are a sole proprietor or freelancer, make sure you are registered as a provisional taxpayer.
Step 2: Start Tracking Your Income and Expenses from 1 March
The tax year begins on 1 March, which means records from that date are relevant to your next tax return. Keep a simple spreadsheet recording all income received and all business-related expenses incurred. Save copies of invoices, receipts, bank statements and contracts. If you use your vehicle for work, start keeping a logbook immediately as SARS requires detailed records for travel claims.
Step 3: Speak to a Registered Tax Practitioner Before July
Tax legislation in South Africa is detailed and changes regularly. A registered tax practitioner can review your specific situation, ensure you are correctly registered, help you calculate your provisional tax estimates accurately and make sure you claim every legitimate deduction you are entitled to. Working with a professional from the start of the year costs far less than resolving errors or penalties later.
The Bottom Line
Earning money in South Africa means you are part of the tax system, whether you earn above or below the threshold. SARS expects you to register, to declare your income and in many cases to file a return annually. The earlier you get organised, the less stressful the process becomes.
If you are unsure where you stand, the most important thing is not to ignore it. SARS has significantly improved its data-matching capabilities in recent years, and unexplained income gaps or unfiled returns are increasingly likely to be picked up.
At hello.tax, we work with individuals at every stage of their tax journey, from first-time earners setting up eFiling for the first time to freelancers navigating provisional tax for the first time. Our process is simple, transparent and personal.
| Ready to get started?Email us at chat@hellotax.co.za or visit hellotax.co.za to book your sign-on. Mention this article and receive 20% off your sign-on fee. Our team is here to make your tax simple. |
Disclaimer: This article is intended for general educational purposes only and does not constitute tax advice. Tax figures referenced are based on the SARS 2025/2026 tax year tables as announced in the February 2025 Budget. All individual tax matters should be assessed by a registered tax practitioner. hello.tax is a registered tax practice. For confirmed filing season dates and updated figures, visit www.sars.gov.za.