Income tax is the government’s main source of income and is levied in terms of the Income Tax Act (No 58 of 1962).

Income tax is levied on the taxpayer’s income. Tax is levied on your taxable income which consists of your gross income after taking off deductions that are allowed by the Act.

Companies and CC’s are taxed at a rate of 27%. From February 2024 qualifying small business corporations are subject to the following progressive rates: 

• 1 to R95 750: 0% of taxable income
• Over R95 750 to R365 000: 7% of taxable income above R95 750
• Over R365 000 up to R550 000: R18 848 + 21%
• Over R550 000: R57 698 + 27% of R57 698

There is also a turnover-based taxation system with progressive rates of 0% to 3% for micro-enterprises with a turnover of not more than R1 million R1 million. 

 Individual tax rates are between 18% and 40%. Trusts pay tax at 45% and is levied on any income retained in the Trust. 

The scale for taxing small-business corporations can be found at the following link: https://www.sars.gov.za/tax-rates/income-tax/companies-trusts-and-small-business-corporations-sbc/