In South Africa, registering for taxes is processed through the South African Revenue Service (SARS). The body is also responsible for tax collection. What is generally known as a Tax Identification Number (TIN) may also simply be called a tax number in South Africa. This tax number allows for easy identification of taxpayers and can be obtained by filling out an e-form from the SARS e-filing web portal or an actual physical copy from any of the SARS registered offices. Tax registration in South Africa is mandatory for entities doing business in the country. South Africa requires businesses to be registered for tax purposes whether or not they are registered as an entity.

Before diving into the procedure for tax registration, which is rather straightforward, it will do us good to first explore the different types of taxes paid in South Africa and requirements as to what is mandatory and what is optional. There are two types of taxes South Africans pay and can register for. These are direct and indirect taxes. Direct taxes are paid directly to the government on income earned, while indirect taxes are paid on goods or services -such as Value Added Tax (VAT).

SARS TIN

The law requires that you have a SARS TIN while making some transactions. These include buying and selling land, importing goods, registering some forms of business and many more. View some of the tax obligations that require you to have a TIN while filing and paying for taxes.

The process for TIN-registration differs for entities and individuals in South Africa.

The documents needed by a company are;

  • Income tax reference number (these are auto-generated after registering the business with the CIPC).
  • The nature of business.

For individuals, there are multiple ways to register for taxes. The easiest method is automatic registration via SARS eFiling. A tax reference number will instantly be generated for first-time registration individuals. The only requirement is a valid and unexpired proof of identity such as a National ID document. Employers may also file income tax on behalf of their employees, and as such one can register for taxes through their employer. The last method is setting up a meeting with the SARS office. You must have booked an appointment to be able to visit the SARS registrar for tax issues. The necessary details to gather are;

  • National ID details for citizens or Passports/ID Card details for foreigners.
  • Original bank statement issued within the past 3 months and stamped by bank.
  • A verified proof of address such as a Utility Bill.

SARS eFiling Portal

Registration for taxes is free of charge in South Africa. Most tax processes have been automated, so this registration is completed using the e-Filing platform of the South African Revenue Service. The process is as simple as four steps;

  1. Visit the SARS e-Filing website.
  2. Click on "Register".
  3. Fill the online form; this should be done as thoroughly as possible.
  4. Submit the application.

The entire process of successfully registering for taxes takes an average of 2 days.

VAT Registration in South Africa

VAT or Value Added Tax in South Africa is mandatory for all individuals and entities that supply or expect to supply taxable goods worth R 1,000,000 or higher within a 12 month period. And it is currently set at 15%. The process for registration is the same as TIN (tax identification number) registration and is carried out through SARS eFiling. The platform has options based on the kind of tax one is looking to register.

Once a company exceeds R1 million in revenue, it is expected to submit a VAT registration form to a nearby SARS office within the next 21 days of reaching the R1 million milestone.

Voluntary VAT registration is allowed for business who have earned over R50,000 within a 12-month period. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.