| Key takeaways Provisional tax isn’t an extra tax, it’s a way of paying income tax in advance, in instalments. You’re a provisional taxpayer if you earn income not taxed at source (business, rental, freelance). For a February year-end, the first IRP6 is due 31 August 2026, the second by 28 February 2027. Underestimate and SARS adds penalties and interest; overestimate and you tie up cash flow. A realistic estimate needs accurate year-to-date figures, not a late-August guess. |
Ask a room of business owners about their tax deadlines and most will name October or January. Far fewer will mention August, and that’s exactly the one that catches them out. Provisional tax is one of the most misunderstood obligations in South African business, and the misunderstanding is expensive.
What is provisional tax in South Africa?
Provisional tax is a method of paying your income tax in advance, in two instalments during the year, rather than in one amount after year-end. It applies to income that isn’t taxed at source, where no employer is deducting PAYE along the way. You estimate your income, pay tax on it via an IRP6, and reconcile later.
Who is a provisional taxpayer?
You’re generally a provisional taxpayer if you earn income not subject to PAYE. In practice that includes:
- Business owners and sole proprietors
- Company directors earning income beyond a regular salary
- Anyone with significant rental, investment or freelance income
- Companies and close corporations, by default
If that’s you, provisional tax applies, whether or not anyone has explained it.
When is provisional tax due in 2026?
For a taxpayer or company with a February year-end, the first provisional payment (IRP6) is due 31 August 2026 and the second by 28 February 2027, with a final reconciliation at annual filing. An optional third top-up payment can be made later to settle any shortfall. That first deadline (in the depths of winter, far from the usual tax-season noise) is the one that slips through.
What happens if my provisional tax estimate is wrong?
Underestimate significantly and SARS can levy penalties and interest on the shortfall; overestimate and you’ve handed SARS cash flow your business needed. The sweet spot is a realistic, defensible estimate, and you cannot produce one from memory in late August. You need accurate year-to-date figures: actual income and expenses for the months passed, plus a sensible projection for the rest.
This is where businesses with up-to-date books have a real advantage: they calculate from facts, not a hopeful guess. It also ties directly to cash flow: a known August payment can be planned for; a surprise one causes a scramble.
How do I work out my provisional tax?
Take your accurate year-to-date income and expenses, project the remainder of the year, and apply the relevant tax rates, ideally off live, reconciled books. Guesswork is where penalties come from. The official rules are on SARS Provisional Tax, and your annual return still follows at filing season.
Frequently asked questions
Who has to pay provisional tax in South Africa?
Anyone earning income not subject to PAYE: business owners, sole proprietors, many directors, people with substantial rental or investment income, and companies.
When is provisional tax due in 2026?
For a February year-end, the first IRP6 is due 31 August 2026 and the second by 28 February 2027, with a final reconciliation at annual filing.
What happens if my provisional estimate is too low?
SARS may charge penalties and interest on a significant underestimate, so an estimate that’s too low can cost more than getting it right.
How do I calculate provisional tax?
From accurate year-to-date income and expenses plus a realistic projection for the rest of the year. Up-to-date books make this straightforward; guesswork makes it risky.
Plan the August payment now, not in late August…
At Zen Accountants in Pretoria, we calculate our clients’ provisional tax off live, reconciled figures, so the estimate is realistic, penalties are avoided, and the payment is planned for, not sprung on you.
Book a free consultation and let’s get your August provisional payment handled properly.
About the author: Zen Accountants is a Pretoria-based accounting, tax and payroll practice serving SMEs across South Africa. This article is general information, not personalised tax advice. Provisional tax depends on your year-end and circumstances; confirm at sars.gov.za.
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