Corporate income tax at 27% on taxable profit, with net profit after tax.
Company tax
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Net profit after tax
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Tax rate
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Your breakdown
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A flat rate, but on a number you have to build
South African company tax is refreshingly simple at first glance. A standard company pays a single flat rate on its taxable profit, and the figure this calculator applies is 27 percent for years of assessment ending on or after 31 March 2023. There are no brackets and no rebates for an ordinary company. The complexity does not live in the rate; it lives in the word taxable. This tool takes the taxable profit you already know and turns it into a tax bill and a net figure, which makes it useful once your accountant has done the harder work of arriving at that taxable number. Treat the 27 percent as the rate this calculator applies and confirm it against the SARS company tax tables, because corporate rates do shift between budgets.
The gap between the profit in your management accounts and the profit SARS taxes is where most surprises hide. Accounting profit is adjusted for tax purposes: you add back expenses that are not deductible, such as accounting depreciation and certain fines, then subtract the tax allowances the law does permit, such as wear-and-tear and capital allowances. Assessed losses carried from earlier years can also reduce the figure. So a company showing R900,000 of accounting profit might present R800,000 of taxable profit to SARS, or it might present more.
Running R800,000 of taxable profit
Suppose the adjustments are done and the company has R800,000 of taxable profit. Using the rate this calculator applies, the arithmetic is one line.
The company keeps R584,000 after the R216,000 charge. That after-tax profit is what can be retained or distributed, and if it is paid out as a dividend a further layer of dividends tax then applies in the shareholder's hands. The chart shows the split of the R800,000.
When the flat rate is not your cheapest option
Smaller companies are not stuck with the flat 27 percent. A qualifying Small Business Corporation can use a reduced progressive scale instead, where the first slice of taxable income is taxed at zero and the next bands climb gently before reaching the standard rate, which can save a meaningful amount at lower profit. Very small businesses with turnover at or below R1 million may elect turnover tax, a simplified tax on turnover rather than profit. Both alternatives carry qualifying conditions on shareholding, income type, and size, so they are not automatic. If your company is small, it is worth checking the SBC scale before assuming the flat rate, and confirming the current thresholds with SARS.
When does the company actually pay this tax?
A company is a provisional taxpayer, so it does not wait for a year-end assessment. It pays a first provisional payment roughly halfway through the year and a second by year-end, each based on estimated taxable income, with a third top-up payment available later to avoid interest. The amount this calculator shows is the full-year liability that those provisional payments are working toward, at the rate this calculator applies.
Does a company with a loss pay any tax?
No. If taxable profit is zero or negative there is no income tax, and this tool shows nil. An assessed loss is carried forward to reduce future taxable profit, though larger companies face a cap on how much of a year's profit a brought-forward loss can offset. Confirm the current loss-offset rules with SARS, as this area has changed.
Is the 27 percent the same for a close corporation?
Yes. A close corporation is taxed as a company, so the same flat rate this calculator applies and the same SBC and turnover-tax alternatives are available to it on the same qualifying conditions. The legal form differs but the corporate tax treatment is the same.