A common complaint amongst South Africa’s tax-paying citizens is our high tax rate when compared to the rest of the world. We are not saying this is not true (South Africa rated as the country with the 12th highest personal income tax rate in 2018), but we want to clarify how the SARS tax brackets work and what your effective tax is for each. South Africa applies a sliding scale to determine the relevant tax rate. Some other countries opt for a fixed rate that is applied generally.
Feel free to play around with where your numerals fall. We have added the last three columns to give you an indication of your effective tax rate, which is normally much lower than your tax bracket rate. This is further reduced by your tax rebates, e.g. for the 2021 tax year (1 March 2020 – 28 February 2021) the rebate is R14,220 for individuals younger than 65 years of age.
| Taxable Income | Rates of Tax | Income | Tax Payable | Effective Tax Rate |
| R1 – R205 900 | 18% of taxable income | R 195 605 | R 35 209 | 18.00% |
| R205 901 – R321 600 | R37 062 + 26% of taxable income above R205 900 | R 305 520 | R 62 963 | 20.61% |
| R321 600 – R445 100 | R67 144 + 31% of taxable income above R321 600 | R 422 845 | R 98 530 | 23.30% |
| R445 101 – R584 200 | R105 429 + 36% of taxable income above R445 100 | R 554 990 | R 144 989 | 26.12% |
| R584 201 – R744 800 | R155 505 + 39% of taxable income above R584 200 | R 707 560 | R 203 615 | 28.78% |
| R744 801 – R1 577 300 | R218 139 + 41% of taxable income above R744 800 | R 1 498 435 | R 527 129 | 35.18% |
| R1 577 301 and above | R559 464 + 45% of taxable income above R1 577 300 | R 1 750 000 | R 677 179 | 38.70% |
2021 Tax season reminder
Just a reminder that, if you are an individual, your annual tax filing for the 2021 Tax Year should be finalised by 23 November 2021. Provisional taxpayers have until 31 January 2022.
If this served as a reminder for perhaps a previous filling season missed, there is no need to panic (we hope), as SARS will only levy a non-compliance penalty if you’re two years behind on your tax filing.
The important thing – file your returns!