South Africa's standard company income-tax rate is 27% for years of assessment ending from 1 April 2026 to 31 March 2027. Qualifying small business corporations use a graduated tax table instead, so a small company should not assume the standard rate is always its final treatment.
Company income tax is generally calculated on taxable income, not on every rand entering the bank account. The distinction matters when you set prices, plan cash and decide what the owner can withdraw. Smartbook's main service is accounting and financial management, helping businesses keep the records needed for those decisions.
Match the rate to the correct tax year
A company's year of assessment normally follows its financial year. That is different from assuming every company follows the personal income-tax year. Confirm your company's recorded financial year-end before using a table or scheduling provisional payments.
The rate and tax table in this guide are for the stated assessment-year window. Do not apply them to a historic return simply because you are completing that return now.
SARS's corporate income-tax guidance explains company returns and provisional tax. Use the company's actual return period and circumstances when calculating its liability, especially if its financial year-end has changed.
Taxable profit is not turnover or cash
Turnover records sales or revenue. Accounting profit reflects revenue and accounting expenses. Taxable income starts from the accounts but requires adjustments under the tax rules. Those terms may produce different amounts for the same business.
Some accounting expenses are not deductible for income tax, while capital assets may be treated through allowances rather than an immediate deduction of the purchase price. Private spending does not become deductible simply because the company paid it.
A loan received or money introduced by a shareholder is not automatically trading income. Loan repayments and owner withdrawals are not automatically deductible expenses. Your accountant should reconcile the movement in cash with the company's income, expenditure and balance-sheet accounts before calculating tax.
The small business corporation table
For qualifying SBCs with years of assessment ending from 1 April 2026 to 31 March 2027, the verified table is as follows.
| Taxable income | Tax calculation |
|---|---|
| R1 to R99,000 | 0% |
| R99,001 to R365,000 | 7% of the amount above R99,000 |
| R365,001 to R550,000 | R18,620 plus 21% of the amount above R365,000 |
| R550,001 and above | R57,470 plus 27% of the amount above R550,000 |
The table does not mean every registered small business qualifies. Eligibility includes conditions concerning the entity, its owners, their other interests, its income and the nature of its activities. Have those conditions reviewed before claiming SBC treatment.
Ask your accountant to confirm the full eligibility tests against the current SARS rules. Do not replace the legal tests with a guess based on staff size, company age or the word 'small' in the business's description.
Turnover tax is a different system
The current rules say turnover tax is available to qualifying micro businesses with turnover of R2.3 million or less from 1 April 2026. Its calculation is based on taxable turnover under that system, not ordinary taxable profit.
Eligibility and registration still matter. A business does not simply choose whichever table produces the smallest amount when preparing its return. Compare the rules and consequences with an accountant before entering or leaving a tax system.
Do not confuse turnover-tax eligibility with VAT registration. Although the same amount appears in these different rules, they concern different taxes and tests. Keep separate records of which system applies and why.
Plan provisional tax during the year
Provisional tax is an advance payment mechanism for income tax, not an additional company tax rate. It uses estimates of taxable income, so reliable management accounts are useful before the final annual statements are ready.
The applicable deadlines place the first payment within six months after the start of the year of assessment and the second by the last day of that year. An optional top-up payment is due by 30 September for February year-ends, or six months after year-end for other year-ends.
Do not wait for the annual return to think about these payments. Review the estimate when trading conditions change, a large sale occurs or an unusual expense arises. Keep the workings and assumptions used rather than recording only the payment amount.
File the annual company return
The company's income-tax return is the ITR14. The verified deadline is within 12 months after the company's financial year-end. This SARS filing is separate from the CIPC annual return linked to the company's registration anniversary.
Prepare the return from reconciled records and the appropriate financial information. Check company particulars, shareholder information and relevant schedules. A dormant or loss-making company still needs its filing position reviewed rather than being ignored.
After submission, retain the acknowledgement and assessment. Reconcile assessed tax with provisional payments and the SARS statement of account. A filed return does not prove that all payments were correctly allocated or that the resulting balance is settled.
Keep owner payments separate
Salary, dividends, expense reimbursements and shareholder-loan movements have different treatment. Do not label every withdrawal 'salary' or 'drawings' without establishing what the transaction actually represents.
The applicable dividends-tax rate is 20%, subject to the applicable rules and exemptions. That is separate from company income tax. A dividend decision also needs proper company-law consideration; having cash available is not the whole test.
Plan remuneration with the accountant using the real business position. Do not promise that moving all profits into a particular payment type automatically eliminates tax. Keep resolutions, payroll records and loan-account evidence consistent with the books.
Frequently asked questions
Is the company taxed on turnover?
Ordinary company income tax generally applies to taxable income. Turnover tax is a separate system for qualifying registered businesses.
Does every small company get SBC rates?
No. The legal eligibility conditions must be met. Being a small employer or newly registered company is not enough.
Is provisional tax an extra tax?
No. It is a way of estimating and paying income tax during the year, with payments reconciled against the final liability.
Does a CIPC annual return replace the ITR14?
No. They have different purposes and deadlines and are submitted to different organisations.
Need an accountant?
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