What are the tax tables?
A tax table is a chart that displays the amount of tax due based on income received. The tax rate in the relevant tables may be shown as an amount, a percentage rate, or a combination of both. Tax tables are used by individuals, companies, small business corporations and trusts for both standard income and capital gains in South Africa.
Why do I need to know about the tax tables?
Understanding Tax Tables are crucially important for individuals and businesses alike as they need to be aware of the amount of taxes payable and when they are required to file tax returns. Understanding the tax tables are important when you need to make certain financial decisions such as selling a property, donating, or investing.
Tax Brackets 2020- 2021
How do I use the tax brackets for my small business correctly?
Depending on whether you are operating as a Sole Proprietor, a Company / Close Corporation or a qualifying Small Business Corporation or a Trust; you would need to look at different tax brackets:
- Sole Proprietors are taxed according to the individual tax brackets.
- Small Business Corporations are taxed according to the Small Business Corporations tax brackets.
- Companies and Close Corporations are taxed at 28% and Trusts are taxed at 45%. These tax rates must be used on your final taxable income after deductions. These different tax rates are covered below in more detail: