Provisional tax can be confusing, especially if you earn income outside of a normal salary. Understanding when you need to pay, how the IRP6 works and how much you should set aside can help you avoid unexpected tax bills, penalties and interest.
If you are a business owner, freelancer, independent contractor, property owner or earn other income that is not fully subject to PAYE, you may be required to register and submit provisional tax returns to SARS.
In this guide, we explain what IRP6 provisional tax is, who needs to pay it, when it is due and how the calculation generally works.
What is provisional tax?
Provisional tax is not a separate tax. It is a mechanism that allows taxpayers to pay their normal income tax liability during the year instead of paying the entire amount after the end of the tax year.
Provisional taxpayers generally make two payments during the year based on their estimated taxable income. A voluntary third payment can also be made after the end of the tax year to help reduce potential interest.
The payments made through provisional tax are ultimately taken into account when your normal income tax liability is calculated.
In simple terms:
You estimate your taxable income → calculate the tax expected to be payable → pay it to SARS during the year → reconcile everything when your annual income tax return is submitted.
Who is a provisional taxpayer?
You may be a provisional taxpayer if you receive income that is not remuneration, such as:
- Income from a business or trade
- Freelance or consulting income
- Rental income
- Investment income
- Certain commission or other non-salary income
- Remuneration from an employer that is not registered for employees’ tax
Companies are generally also provisional taxpayers.
Not every individual who earns additional income will necessarily have to pay provisional tax. For example, an individual who does not carry on a business may be excluded where their taxable income does not exceed the applicable tax threshold, or where certain specified income such as interest, dividends, rental income or remuneration from an unregistered employer does not exceed R30,000 for the relevant year.
Because the rules can depend on the type and amount of income you receive, it is important to determine your provisional taxpayer status correctly.
What is an IRP6?
The IRP6 is the provisional tax return submitted to SARS.
When completing an IRP6, you provide SARS with an estimate of your taxable income for the relevant year of assessment. The return is used to calculate the provisional tax payable for that period.
The IRP6 is submitted electronically through SARS eFiling. SARS provides for both first- and second-period provisional tax returns, and an IRP6 can still be submitted even where the provisional tax payable is nil.
When is provisional tax due?
For taxpayers with a standard 1 March to 28/29 February tax year, there are two main provisional tax periods.
| Provisional tax payment | General due date |
|---|---|
| 1st IRP6 2027/01 | 31 August 2026 |
| 2nd IRP6 2027/02 | 26 February 2027 |
| 3rd / voluntary top-up | Last working day of September |
The first payment falls six months into the tax year, while the second payment is due by the end of the tax year. The third payment is voluntary and can be used to reduce potential interest where the first two payments were insufficient.
Important: August provisional tax
For taxpayers following the standard March-to-February tax year, the first provisional tax payment is due at the end of August.
This means that if you earn income outside of PAYE, it is important to review your estimated taxable income before the August deadline rather than waiting until your annual income tax return is due.
How is provisional tax calculated?
The IRP6 calculation starts with your estimated taxable income for the full year.
For a business owner, for example, this could involve estimating:
Business income
minus
Allowable business expenses
equals
Estimated taxable income
Your estimated taxable income is then used to determine the expected normal tax liability, taking into account applicable tax rates, rebates, credits and other relevant amounts.
PAYE already deducted from your income can also be taken into account when determining the amount of provisional tax payable.
SARS states that provisional tax payments are based on estimated taxable income, including current taxable capital gains where applicable.
First provisional tax payment
The first IRP6 covers the first six months of the tax year.
At this stage, you generally need to estimate what your full-year taxable income is expected to be and use that estimate to calculate the provisional tax payment.
It is important not to simply use the income already received during the first six months as your annual taxable income. You should consider what you expect your total income and deductible expenses to be for the entire year.
Second provisional tax payment
The second IRP6 is particularly important because you have much more information available about your actual income and expenses.
By the second provisional tax period, you should review your original estimate and update it where necessary.
For example, your business may have performed better than expected, or you may have received additional rental, investment or freelance income.
If your estimated taxable income has increased, your second provisional tax calculation should be adjusted accordingly.
This is one of the best opportunities to prevent a large unexpected tax liability when your annual income tax return is eventually submitted.
What happens if you underestimate your income?
One of the biggest risks associated with provisional tax is underestimating your taxable income.
SARS may impose a penalty where the taxable income estimated on the second provisional tax return is too low compared with the taxable income ultimately determined. The rules differ depending on the taxpayer’s circumstances and taxable income.
For example, for taxpayers with taxable income of up to R1 million, SARS’s rules can result in a penalty where the second provisional estimate is below both the applicable percentage of actual taxable income and the basic amount.
This is why it is important to make a reasonable and supportable estimate, rather than deliberately submitting a low estimate simply to reduce the immediate payment to SARS.
Can I submit a nil IRP6?
Yes. An IRP6 can be submitted even where the provisional tax payable is nil. However, the estimate should still be based on your actual circumstances and expected taxable income.
If you expect to have taxable income for the year, submitting a nil estimate without a reasonable basis can create problems later.
What happens when I pay too much provisional tax?
If your provisional tax payments are higher than your final income tax liability, the excess amount is generally taken into account when your annual income tax return is assessed.
Provisional tax payments, together with PAYE withheld during the year, are offset against the final normal tax liability.
This means provisional tax is not money that you simply lose if your estimate turns out to be higher than your final taxable income. It forms part of the overall calculation of your final income tax position.
What happens if I pay too little?
If your final income tax liability is higher than the provisional tax and PAYE already paid, the difference becomes payable when the final assessment is processed.
There can also be interest and penalties depending on the circumstances, including late payment and underestimation of taxable income.
This is why reviewing your provisional tax estimate throughout the year is important.
2026/27 tax year: individual tax rates
For individuals, the 2027 year of assessment runs from 1 March 2026 to 28 February 2027.
The current individual tax rates range from 18% to 45%, with the highest marginal rate applying to taxable income above R1,878,600. The primary rebate for the 2027 tax year is R17,820.
The tax calculation for each taxpayer will depend on their individual circumstances, including age, taxable income, rebates, deductions, tax credits and PAYE already paid.
A simple example
Imagine a self-employed individual expects their taxable income for the year to be R600,000.
They would estimate their annual income and allowable expenses and arrive at an estimated taxable income of R600,000.
The estimated normal tax is then calculated using the applicable tax rates and relevant rebates.
If the taxpayer has already had PAYE deducted from another source of income, that PAYE may reduce the amount that needs to be paid through provisional tax.
The first and second IRP6 payments are then used to pay the expected tax liability during the year.
The actual calculation can be more complicated, particularly where a taxpayer has multiple income sources, capital gains, medical tax credits, retirement fund contributions, foreign income or other deductions.
Common provisional tax mistakes
1. Forgetting that rental income can create a provisional tax obligation
Property owners sometimes focus only on the rental received and forget that the rental income may have income tax consequences.
2. Using turnover instead of taxable income
Your provisional tax calculation is not simply based on your business’s turnover.
You need to consider income and allowable deductions to determine estimated taxable income.
3. Keeping the first estimate unchanged
If your income increases significantly during the year, your original estimate may no longer be appropriate.
Your second IRP6 should be reviewed using the latest available financial information.
4. Forgetting other sources of income
Interest, rental income, freelance work, investment income and other taxable income can affect your overall tax liability.
5. Paying after the deadline
Even if the IRP6 has been submitted, the payment itself must be made on time. SARS also notes that electronic payments should allow for bank cut-off times and clearance periods.
6. Waiting until the annual tax return
Provisional tax is designed to spread your tax liability throughout the year. Waiting until your annual income tax return can result in a large unexpected amount being payable.
2026 Filing Season and provisional taxpayers
SARS has also made changes for Filing Season 2026, including extending auto-assessments to certain eligible provisional taxpayers.
For provisional taxpayers who are not auto-assessed, the 2026 individual filing period runs from 13 July 2026 to 22 January 2027.
Being a provisional taxpayer does not mean you are exempt from submitting your annual income tax return. Your provisional tax payments and your final income tax assessment work together.
Need help with your IRP6?
Provisional tax is much easier to manage when your income and expenses are properly recorded throughout the year.
At Kolisa, we can assist individuals and businesses with the preparation and submission of provisional tax returns, including reviewing income, expenses and previous tax information to help ensure that your estimate is reasonable and properly supported.
We can also assist with your annual income tax return and ongoing tax compliance.
Don’t wait until the deadline to find out how much tax you may owe.
Contact Kolisa today to discuss your provisional tax requirements and make sure your IRP6 is submitted accurately and on time.
Important Disclaimer
The information in this article is intended for general information purposes only and does not constitute tax or financial advice. Tax legislation, rates, thresholds, deadlines and SARS requirements may change. Your provisional tax obligations depend on your individual or business circumstances. For advice relating to your specific tax position, consult a registered tax practitioner or SARS.
Sources: South African Revenue Service (SARS) – Provisional Tax Guide, Provisional Tax information and 2026/27 Budget Tax Guide.