South Africa – 2023 Legislation changes
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Effective from 1 March 2023, the South African Government announced the following Amendments to its income tax law:
Under the amendments the below changes have been implemented:
- National Minimum wage has been amended as below:
- 42 per hour
- Farm Workers – R25.42 per hour.
- Domestic Workers – R25.42 per hour.
- Workers employed on an expanded public works programme – R13.97 per hour.
- Workers who have concluded learnership agreements contemplated in section 17 of the Skills Development Act, new rates are indicated in Schedule 2 of the Government Gazette – R13.97 per hour.
- The new OID Maximum earnings limit is R563 520.
- The prescribed reimbursement rate per kilometre has change to R4.64.
- The subsistence allowance has been altered as follows.
- Meals and incidentals – R522.00 per day/part of a day.
- Incidentals only – R161.00 per day/part of a day.
- The annual tax rebates have been modified as follows.
- Primary – R17 235.00
- Secondary – R9 444.00
- Tertiary – R3 145.00
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- The annual tax thresholds have been adjusted as follows.
- Under 65 – R95 750.00
- 65 and older – R148 217.00
- 75 and older – R165 689.00
- The annual tax thresholds have been adjusted as follows.
Table for calculation of rate per km/travel allowance has been revised as follows:
| Value of the vehicle (including VAT) (R) | Fixed Cost (R.p.a) | Fuel Cost (c/km) | Maintenance Cost (c/km) |
|---|---|---|---|
| 0 - 100 000 | 33 760 | 141.50 | 43.80 |
| 100 001 - 200 000 | 60 329 | 158.00 | 54.80 |
| 200 001 - 300 000 | 86 958 | 171.70 | 60.40 |
| 300 001 - 400 000 | 110 554 | 184.60 | 65.90 |
| 400 001 - 500 000 | 134 150 | 197.60 | 77.50 |
| 500 001 - 600 000 | 158 856 | 226.60 | 91.00 |
| 600 001 - 700 000 | 183 611 | 230.50 | 102.10 |
| 700 001 - 800 000 | 209 685 | 234.30 | 113.10 |
| 800 001 and above | 209 685 | 234.30 | 113.10 |
The annual income tax rates have been changed as follows:
| Taxable income (R) | Rates of tax (R) |
|---|---|
| 1 – 237 100 | 18% of taxable income |
| 237 101 – 370 500 | 42 678 + 26% of taxable income above 237 100 |
| 370 501 – 512 800 | 77 362 + 31% of taxable income above 370 500 |
| 512 801 – 673 000 | 121 475 + 36% of taxable income above 512 800 |
| 673 001 – 857 900 | 179 147 + 39% of taxable income above 673 000 |
| 857 901 – 1 817 000 | 251 258 + 41% of taxable income above 857 900 |
| 1 817 001 and above | 644 489 + 45% of taxable income above 1 817 000 |
The medical tax credits have been amended as follows:
| Situation | Per month (R) |
|---|---|
| For the taxpayer | 364.00 |
| For the taxpayer and one dependant | 728.00 |
| For each additional dependant | 246.00 |
The annual Retirement fund lump sum withdrawal benefit rates have been revised as follows:
| Taxable income (R) | Rates of tax (R) |
|---|---|
| 1 – 27 500 | 0% of taxable income |
| 27 501 - 726 000 | 18% of taxable income above 27 500 |
| 726 001 - 1 089 000 | 125 730 + 27% of taxable income above 726 000 |
| 1 089 001 and above | 223 740 + 36% of taxable income above 1 089 000 |
The annual Retirement fund lump sum or severance benefits rates have been adjusted as follows:
| Taxable income (R) | Rates of tax (R) |
|---|---|
| 1 – 550 000 | 0% of taxable income |
| 550 001 – 770 000 | 18% of taxable income above 550 000 |
| 770 001 – 1 155 000 | 39 600 + 27% of taxable income above 770 000 |
| 1 155 001 and above | 143 550 + 36% of taxable income above 1 155 000 |
For the tax year commencing on 1 March 2023, the above-mentioned changes will need to be effected and applied to ensure compliance with the legislated regulation changes.
Please contact your Mercans’ services delivery team for any additional information regarding the implications of the above change
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South Africa – 2023 Legislation Change1.12 MB