Update on South Africa's 2025 Budget: Tax Proposals and Their Implications
In the 2025 Budget Speech delivered on March 12, Finance Minister Enoch Godongwana outlined several tax proposals aimed at addressing South Africa's fiscal challenges. These measures are designed to increase revenue and fund essential public services, impacting both individuals and businesses.
Understanding the South African Budget Process: From Proposal to Parliamentary Ratification
The South African budget process is a meticulous and continuous cycle that ensures government spending aligns with the country's policy goals and objectives. This process begins with the Budget Speech and culminates in parliamentary ratification, involving several critical steps along the way.
South Africa Increases Carbon Tax to Combat Climate Change
In a significant move to bolster its climate change mitigation efforts, South Africa has announced an increase in its carbon tax. Effective from January 1, 2025, the carbon tax will rise from R190 to R236 per tonne of carbon dioxide equivalent (tCO2e). Additionally, from April 2, 2025, the carbon fuel levy will increase by 3c/litre to 14c/litre for petrol and 17c/litre for diesel, as mandated by the Carbon Tax Act of 2019.
South Africa to Increase VAT Rate in 2025
In a significant move to boost revenue, the South African government has announced a two-phase increase in the Value Added Tax (VAT) rate. The first increase of 0.5 percentage points will take effect on 1 May 2025, followed by another 0.5 percentage point increase on 1 April 2026. This decision comes after careful consideration of the potential contributions of various tax instruments, with VAT being identified as an efficient and broad-based source of revenue.
Review of the 2025 Budget Speech
The 2025 Budget Speech addressed the economic stagnation of the past decade, with GDP growth averaging less than 2%. In 2024, the economy grew by only 0.6%, and medium-term projections estimate an average growth of 1.8%. The speech emphasized the need for faster, inclusive economic growth to meet developmental goals.
5 Things to Consider When Buying vs Leasing Equipment
As a business owner or financial manager one of the most important decisions you will make is whether to buy or lease the equipment your business needs to operate.
How to Save Big on Corporate Travel in 2025
Online meeting apps have absolutely boomed over the past few years. But in a post-COVID world, business travel is still an expensive necessity for many companies.
Disagree with SARS? Here’s How we Can Assist You
If you don’t agree with an assessment from SARS, swift action and careful management of the dispute process will maximise your chances of a favourable outcome.
6 Signs it Might be Time to Pivot
The biggest benefit of small businesses is their adaptability. It’s much easier for a small business to pivot and change course when things are going wrong.
IFRS Updates
Maximising Your Wealth: The SARS Foreign Investment Allowance
For South Africans looking to diversify their investments internationally, the South African Revenue Service (SARS) offers a useful tool - the Foreign Investment Allowance (FIA). This facility allows individuals to legally transfer funds offshore, providing them with access to global markets, asset protection, and financial growth. However, navigating the FIA requires careful planning to ensure compliance and avoid unnecessary risks.
The Enormous Benefits of Non-Profit Collaborations
A new year is often a time to rethink your strategy. One option you may not yet have considered is going into partnership with a charity or non-profit organisation.
What Your Balance Sheet Says About Your Business
A balance sheet is a vital financial report for a business, providing a snapshot of the company’s financial health by detailing its assets, liabilities and owners’ equity. These are also used to calculate important financial ratios.
Building a Business: Should You Bring in Funders or Go it Alone?
Building a small business on your own can be hard. It’s difficult to know just where each hour of work and precious cent should go to maximise growth. Product testing, marketing, website costs and infrastructure – these are not cheap and may be hard to put together all at once when starting out. This is why many turn to external investors for help.
Are You Ready for the Next Provisional Tax Deadline?
The second provisional tax deadline for the 2025 tax year is just days away (28 February 2025). It’s the trickiest and most important provisional tax deadline of the tax year, because the income estimates on which it’s based must be highly accurate. Estimates that don’t fall within 80 – 90% of your actual taxable income can expose taxpayers to a stiff 20% under-estimation penalty.
SARS Reports Over 2 Million Tax Directive Applications for Savings Withdrawals
The South African Revenue Service (SARS) has announced a significant milestone in the implementation of the two-pot system, with a total of 2,664,279 applications for tax directives received to date. Of these, 2,403,379 applications have been approved, resulting in a total gross lump sum payout of R 43.42 billion.
IMF Issues Warning to South Africa Amid Economic Challenges
On January 31, 2025, the International Monetary Fund (IMF) issued a stark warning to South Africa, highlighting several ongoing economic challenges that could hinder the country's growth prospects. The warning comes in the wake of the IMF's Article IV Consultation with South Africa, conducted from November 11 to 25, 2024.
CIPC Initiates Deregistration of Non-Compliant Companies
The Companies and Intellectual Property Commission (CIPC) has announced a significant wave of deregistrations due to continued non-compliance with the Companies Act. As of January 17, 2025, a large volume of companies have been deregistered for failing to meet obligations such as Annual Returns and Beneficial Ownership declarations.
SARS Invites Public Input on 2025 Budget
The South African Revenue Service (SARS) has issued a call for public input on the upcoming 2025 Budget. Finance Minister Enoch Godongwana will deliver the National Budget Speech in February 2025, and the government is seeking suggestions from South Africans on various budget-related topics.
Amendments to the Companies Act
Why Email is Destroying Your Business (And How to Stop it)
In June 2019, Slack co-founder and CEO Stewart Butterfield declared that business email would be dead and buried within seven years. Now, six years later, email remains as strong as ever – despite the weaknesses Butterfield saw still being there.
Starting a New Business? Here Are the Tax Implications...
Starting a new business isn’t just a challenging undertaking. It also comes with a list of tax liabilities and administrative obligations. Not to mention an impact on the business owner’s personal tax affairs.
Tax Compliance in 2025: Help Is at Hand