Small business corporation tax rates: what does a (Pty) Ltd pay?

Company tax rate

27%

Of every rand of taxable income, for a company that isn’t an SBC [1].

SBC: up to R99,000

0%

No tax on the first R99,000 [1].

SBC: R99,001 to R365,000

7%

Of the amount above R99,000 [1].

SBC: R365,001 to R550,000

R18,620 + 21%

Of the amount above R365,000 [1].

SBC: over R550,000

R57,470 + 27%

Of the amount above R550,000 [1].

1. 1

   Every shareholder is a natural person, all year

   An individual, not a company or a trust that holds the shares for itself [2], [3].

2. 2

   No shareholder owns shares in another company

   Except kinds the law allows, like listed shares and unit trusts. Even one day disqualifies the year [3].

3. 3

   Gross income of R20 million or less

   Less if it traded for under 12 months of the year [2], [3].

4. 4

   At most 20% from investment income and personal services

   Investment income includes interest, dividends, royalties and rent. Personal services are work like consulting, IT, accounting, law or engineering done by an owner [2], [3].

5. 5

   Not a personal service provider

   An owner, or someone connected to them, personally serves a client, and either works like that client’s employee or the company earns over 80% of its service income from that client [2].

Personal services stop counting, and the company isn’t a personal service provider, if three or more full-time employees who aren’t owners, or connected to them, work in that service all year [2], [3].