SARS has released the August 2026 edition of its SMME Connect newsletter, highlighting a number of important tax compliance issues and recent changes affecting small and medium-sized businesses.

A key update is the expanded Turnover Tax regime. From 1 April 2026, the annual turnover threshold for qualifying micro-businesses increased from R1 million to R2.3 million, while the tax-free threshold increased from R500,000 to R600,000. Turnover Tax offers qualifying businesses a simplified tax system that can replace Income Tax, Provisional Tax, Capital Gains Tax and Dividends Tax, potentially reducing both compliance costs and administrative requirements.

SARS has also reminded provisional taxpayers of their payment obligations. Provisional Tax applies to individuals and entities earning income that is not subject to PAYE. The first and second compulsory payments are generally due by the last business day of August and February respectively, with an optional third payment available to reduce any potential shortfall. Accurate estimates are important, as underestimating taxable income or submitting returns late may result in penalties.

Small businesses are also encouraged to keep their Tax Compliance Status up to date. A valid status can be important when applying for contracts, funding and other business opportunities. SARS stresses that all returns should be submitted, outstanding tax debt addressed and supporting information kept current.

Record keeping remains another important compliance requirement. Businesses should generally retain relevant financial and transactional records for at least five years, and longer where an audit or investigation remains unresolved.

Finally, SARS continues to expand its digital support channels while warning taxpayers to remain alert to scams and phishing attempts.

The full August 2026 SMME Connect newsletter is available on the SARS website. Should you require assistance with your business tax obligations, please don’t hesitate to contact our offices.