Provisional Tax for Freelancers and Side Hustles in South Africa (2026/2027)

1. What Provisional Tax Is

If you earn a salary, your employer deducts PAYE every month, so SARS gets its money as you earn it. Freelancers, contractors, landlords and anyone else with income that has no PAYE taken off do not have that. Provisional tax is SARS's way of collecting tax on that income during the year instead of all at once at the end.

It is not an extra tax. It is an advance payment of the normal income tax you will owe for the year. You estimate your taxable income, pay roughly half the tax by the end of August and the rest by the end of February, and then your annual return squares the account.

2. Who Has to Pay It

You are a provisional taxpayer if you are an individual who earns income other than a salary, or a salary from an employer that is not registered for PAYE. In practice that covers:

• Freelancers, consultants and independent contractors
• Sole proprietors and anyone running a business in their own name
• Landlords earning rental income (see our rental income tax guide)
• People with large interest or foreign dividend income
• Crypto traders whose profits are taxed as income (see our crypto tax guide)
• Anyone SARS has specifically told is a provisional taxpayer

Who is excluded

If you do not run a business, you are excluded from provisional tax for 2026/2027 if either of these is true:

• Your taxable income for the year will not be more than the tax threshold: R99,000 if you are under 65, R153,250 if you are 65 to 74, or R171,300 if you are 75 or older; or
• Your taxable income from interest, foreign dividends, renting out property and pay from an unregistered employer will not be more than R30,000.

Interest on its own, below R23,800 (under 65) or R34,500 (65 and older), does not make you a provisional taxpayer, because that much interest is exempt. Interest earned in a tax-free savings account does not count either.

3. The 2026/2027 Deadlines

For individuals the tax year runs from 1 March 2026 to 28 February 2027. Each payment is made with an IRP6 return on eFiling.

Payment	What it covers	Due date for 2026/2027
First period	About half the year's estimated tax	Monday 31 August 2026
Second period	The rest of the year's estimated tax	Friday 26 February 2027 (last business day of February)
Third (optional top-up)	Any shortfall, to limit interest	Thursday 30 September 2027 (last business day of September)

If a due date falls on a weekend or public holiday, the payment is due on the business day before it. Note that SARS needs the money in its account by the due date, so pay a few days early if you use EFT.

4. How to Work Out Each Payment

Each IRP6 asks for an estimate of your taxable income for the whole year: your income minus allowable business expenses and deductions such as retirement annuity contributions. SARS then works out the tax on that estimate.

1. Estimate your taxable income for the full year.
2. Work out the normal tax on it using the 2026/2027 tables, and subtract your rebates (R17,820 primary rebate, plus age rebates if you qualify) and medical tax credits.
3. For the first payment, pay half of that, minus any PAYE already deducted from you in the first six months.
4. For the second payment, update the estimate and pay the full year's tax, minus the first payment and all PAYE for the year.

Example: a freelance designer

Naledi, 34, freelances full time. She expects R520,000 in client fees and R120,000 in business expenses, so her estimated taxable income is R400,000.

• Tax on R400,000: R79,998 + 31% of (R400,000 − R383,100) = R85,237
• Less primary rebate R17,820 = R67,417 for the year
• First payment (by 31 August 2026): about R33,709
• Second payment (by 26 February 2027): the balance, after updating her estimate with real figures

Our PAYE calculator uses the same 2026/2027 tables, so you can enter your estimated taxable income as an annual salary to check the tax figure.

Capital gains

If you sell an asset during the year, such as shares, crypto held as an investment or a second property, the taxable part of the capital gain must be included in both IRP6 estimates. Our CGT calculator works out that taxable part.

5. The Penalties and How to Avoid Them

Late payment: 10%

If you pay either the first or second payment late, SARS charges a penalty of 10% of the late amount, plus interest. This is the most common provisional tax penalty and the easiest to avoid: pay on time, even if you are not sure the estimate is perfect.

Underestimating: 20%

SARS also penalises you if your second estimate turns out to be too low once your actual taxable income is assessed. The rule depends on your income:

Actual taxable income	You may be penalised if your second estimate was…
R1 million or less	Less than 90% of your actual taxable income and less than your basic amount
More than R1 million	Less than 80% of your actual taxable income

The penalty is 20% of the shortfall between the tax you should have paid on that 90% or 80% figure and the PAYE and provisional tax you actually paid by year end. SARS reduces it by any late-payment penalty already charged for the second period, so you are not hit twice for the same rand.

Not filing the second IRP6

If you do not submit the second IRP6 within four months after the tax year ends, SARS treats you as having estimated nil taxable income, which almost guarantees an underestimation penalty.

Example: the penalty in rand

Pieter's actual taxable income for the year is R400,000. His basic amount (from his last assessment) is R280,000. He estimated only R250,000 and paid R30,000 in total.

• 90% of actual: R360,000. Tax on that after the rebate: R56,172.
• Tax on his basic amount of R280,000 after the rebate: R35,372.
• SARS uses the lower of the two: R35,372.
• Shortfall: R35,372 − R30,000 paid = R5,372. Penalty: 20% = R1,074, plus interest on the underpaid tax.

6. The "Basic Amount" Safe Harbour

For taxable income up to R1 million, there is a simple way to stay safe: estimate at least your basic amount. Your basic amount is the taxable income on your most recent assessment (issued at least 14 days before your IRP6 is due), excluding capital gains, retirement lump sums and severance benefits. If that assessment is more than 18 months old, you must increase it by 8% for each year.

If your second estimate is at least your basic amount, you will not get the 20% penalty, even if your income turns out far higher. You will still owe the extra tax, and interest, but no penalty. This makes the basic amount useful when your income is unpredictable.

The safe harbour does not apply if your taxable income is above R1 million. Then your estimate has to be at least 80% of the real figure.

7. Salaried With a Side Hustle

Many people earn a salary and also freelance, tutor, sell online or drive for a ride-hailing app. Your employer's PAYE only covers your salary, so the side income is taxed at your highest marginal rate. If your salary already puts you in the 31% bracket, every R1,000 of side profit adds about R310 to your tax bill.

Because a side business counts as business income, you are a provisional taxpayer from the first rand. You must file IRP6s, and your estimate should include your salary, your side profit and your PAYE. In the IRP6 you subtract the PAYE your employer has deducted so far, so you only pay provisional tax on the gap.

8. Registering and Filing on eFiling

1. Register. If you are already registered for income tax on eFiling, ask SARS to activate provisional tax on your profile. You will then see IRP6 returns for each period.
2. Open the IRP6 for the right period and year under Returns.
3. Enter your estimate of taxable income for the full year. eFiling calculates the tax, takes off rebates and credits you enter, and shows the amount due.
4. Pay using the payment reference number on the return, through eFiling or your bank, by the due date.
5. File your ITR12 after the tax year ends. SARS deducts your provisional payments from the final tax and either refunds you or bills the balance.

9. Habits That Keep You Out of Trouble

• Keep invoices, receipts and a simple income and expense spreadsheet every month, not just in August and February.
• Put the three due dates in your calendar now: 31 August 2026, 26 February 2027 and 30 September 2027.
• Never skip a payment because the estimate is uncertain. A reasonable estimate paid on time beats a perfect one paid late.
• If your income rises sharply late in the year, update the second estimate to match. Use the September top-up if you still underpaid.
• Contribute to a retirement annuity before 28 February if you can: contributions up to 27.5% of your income (maximum R430,000) reduce your taxable income and your provisional tax.

Frequently Asked Questions

Sources

Every figure on this page was checked against these official sources on 19 October 2026:

• SARS: Provisional tax
• SARS: Guide for Provisional Tax (GEN-PT-01-G01, effective 16 October 2026)
• SARS: Rates of tax for individuals (2027 tax year)
• SARS: Budget 2026 frequently asked questions