Calculate income tax, provisional tax payments, and deductions for freelancers, contractors, and self-employed individuals. Stay SARS-compliant with accurate tax planning.
Calculate income tax, provisional payments & deductions for freelancers
Total freelance/business income before expenses
Software, equipment, office, travel, etc.
Max deductible: R110,000(27.5% of income, capped at R350K)
Annual medical aid premiums (for tax credit)
Tax credit: R364/month + R246/month per dependent
Age affects tax rebates and thresholds
Based on 50% of estimated annual tax
Balance of annual tax liability
⚠️ Late Payment Penalty: 10% interest on underpayments. Pay provisional tax on time to avoid penalties!
Your R150,000 in deductions (expenses + retirement) save you approximately R45,474.95 in tax!
Provisional tax is a pre-payment system where self-employed individuals, freelancers, and business owners pay their estimated tax twice a year (August and February) instead of once annually.
Two payments: End of August and end of February each year
Freelancers, contractors, business owners earning >R1M or <80% PAYE
10% interest on underpayments. Always estimate conservatively!
Business expenses, retirement (27.5%), medical aid credits reduce tax
Due: End of August (31 Aug for companies, 28 Aug for individuals)
Based on 50% of previous year's tax or 50% of estimated current year tax (whichever is higher).
Due: End of February (28/29 Feb for companies and individuals)
Balance of estimated annual tax liability. Must be at least 80% of actual tax to avoid penalties.
Due: Within 6 months of year-end (e.g., 30 Sep for Feb year-end)
Optional "top-up" payment if you underestimated. Avoids penalties if you reach 90% of actual tax.
Important: Expenses must be "wholly and exclusively" for business purposes. Keep receipts, invoices, and records for at least 5 years. Personal expenses are NOT deductible.
Freelancers can deduct retirement fund contributions up to 27.5% of taxable income, capped at R350,000 per year.
Example: Earn R500K net income → Max deduction R137,500 (27.5%). At 31% tax bracket, saves R42,625 in tax while building retirement savings!
Note: Tax-free savings accounts (TFSA) do NOT qualify for this deduction.