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Paragraph 28 (Fourth Schedule) – General employees’ tax and provisional tax to be set off against tax liability

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28.    


(1)     There shall be set off against the liability of the taxpayer in respect of any taxes (as defined in subparagraph (8)) due by the taxpayer, the amounts of employees’ tax deducted or withheld by the taxpayer’s employer during any year of assessment for which the taxpayer’s liability for normal tax has been assessed by the Commissioner and the amounts of provisional tax paid by the taxpayer in respect of any such year, and if—

(a)     the sum of the said amounts of employees’ tax and provisional tax exceeds the amount of the taxpayer’s total liability for the said taxes, the excess amount shall be refunded to the taxpayer; or

(b)     the taxpayer’s total liability for the aforesaid taxes exceeds the sum of the said amounts of employees’ tax and provisional tax, the amount of the excess shall be payable by the taxpayer to the Commissioner.

[Sub­paragraph (1) amended by section 30 of Act 95 of 1967 and substituted by section 48 of Act 89 of 1969, by section 48(a) of Act 88 of 1971, by section 55(1) of Act 85 of 1974, by section 53(a) of Act 94 of 1983, by section 30(1)(a) of Act No. 65 of 1986 and by section 52 of Act 34 of 2019]

(2)     The burden of proof that any amount of employees’ tax has been deducted or withheld by his employer shall be upon the taxpayer and any employees’ tax certificate shall be prima facie evidence that the amount of employees’ tax reflected therein has been deducted by the employer.

(3)     If the Commissioner is satisfied that the amount or any portion of the amount of employees’ tax shown in any employees’ tax certificate has not been deducted or withheld by the employer and the amount of employees’ tax shown in such tax certificate has been applied as provided in sub–paragraph (1), the employer and the employee shall be jointly and severally liable to pay to the Commissioner the amount which should not have been so applied and such amount shall be recoverable under this Act as if it were a tax.

(4)     An employer who has under sub–paragraph (3) paid to the Commissioner an amount which has but should not have been applied under the provisions of sub–paragraph (1), may, if the amount was shown or included in the certificate because of a bona fide error, recover the amount so paid from the employee concerned, and in that case the provisions of sub–paragraph (3) of paragraph 5 shall mutatis mutandis apply.

(5)     No employees’ tax certificate shall be issued by the employer in respect of any amount recovered by him from the employee in terms of sub–paragraph (4) nor shall any such amount be included in any return rendered in terms of sub–paragraph (3) of paragraph 14.

(6)     If the Commissioner is satisfied that the employee to whom an employees’ tax certificate refers was directly or indirectly responsible for an incorrect amount being shown on such certificate he may absolve the employer from the liability imposed upon him by sub–paragraph (3), and in that case the employee shall be solely liable under that sub–paragraph.

(7)     . . . . . .

[Sub-paragraph (7) added by section 29(1)(b) of Act 90 of 1964 and deleted by section 14 of Act 16 of 2016]

(8)     For the purposes of this paragraph, “taxes” means the normal tax levied under this Act.

Paragraph 27 (Fourth Schedule) – Penalty on late payment of provisional tax

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27.       PENALTY ON LATE PAYMENT OF PROVISIONAL TAX

 

(1)     If any provisional taxpayer fails to pay any amount of provisional tax for which he or she is liable within the period allowed for payment thereof in terms of paragraph 21 or 23, or paragraph 25 (1), the Commissioner must, under Chapter 15 of the Tax Administration Act, impose a penalty, which is deemed to be a percentage based penalty imposed under Chapter 15 of the Tax Administration Act, equal to ten per cent of the amount not paid.

Paragraph 25 (Fourth Schedule) – Extension of time for payment of provisional tax

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25.       EXTENSION OF TIME FOR PAYMENT OF PROVISIONAL TAX

 

(1)     If after the end of any period within which provisional tax is payable in terms of this Schedule the Commissioner has under the provisions of sub–paragraph (3) of paragraph 19 increased the amount of any estimate of taxable income submitted by any provisional taxpayer during such period, any additional provisional tax payable as a result of the Commissioner having made such increase shall, notwithstanding the provisions of paragraphs 21, and 23, be payable within such period as the Commissioner may determine.

 

26.  ……….

Paragraph 24 (Fourth Schedule) – Determination by Commissioner if estimation cannot be made

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24.    The Commissioner may absolve any provisional taxpayer from making payment of any amount of provisional tax payable in terms of paragraph 21(1)(a) or paragraph 23(1)(a), if the Commissioner is satisfied that the taxable income which may be derived by such taxpayer for the year of assessment in question cannot be estimated on the facts available at the time when payment of the amount in question has to be made.

[Paragraph 24 amended by section 27 of Act 72 of 1963 and substituted by section 30(1) of Act 88 of 1965, by section 54 of Act 85 of 1974, by section 52 of Act 94 of 1983, by section 12 of Act 44 of 2014 and by section 6 of Act 16 of 2022]

Paragraph 23A (Fourth Schedule) – Additional provisional tax payments

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23A.      ADDITIONAL PROVISIONAL TAX PAYMENTS

 

(1)     Any provisional taxpayer may for the purpose of avoiding or reducing his liability for any interest which may become payable by him in respect of any year of assessment under section 89quat, elect to make an additional payment of provisional tax in respect of such year.

 

(2)     If any additional payment of provisional tax contemplated in subparagraph (1) is paid after the end of the period ending on the effective date in relation to the said year as determined under section 89quat(1), such payment shall be deemed for the purposes of section 89bis(2) to be an amount of provisional tax which was payable within the said period.

Paragraph 23 (Fourth Schedule) – Provisional tax payments by companies

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23.       PROVISIONAL TAX PAYMENTS BY COMPANIES

(1)     Provisional tax shall be paid by every company which is a provisional taxpayer in the following manner, namely—

(a)     within the period ending 6 months after the commencement of the year of assessment in question, one half of an amount equal to the total estimated liability of such company (as determined in accordance with paragraph 17) for normal tax in respect of that year;

(b)     within the period ending on the last day of that year, an amount equal to the total estimated liability of such company (as so determined) for normal tax in respect of that year less the amount paid in terms of item (a),

less, in either case, the total amount of –

(i)      any employees tax deducted by the taxpayer’s employer from the taxpayer’s remuneration during the relevant period; and

(ii)     any tax proved to be payable to the government of any other country which will qualify as a rebate under section 6quat.

[Subparagraph (1) substituted by section 30(1) of Act 88 of 1965, by section 53(1) of Act 85 of 1974 and by section 51 of Act 94 of 1983, amended by section 53 of Act 101 of 1990 and by section 11 of Act 9 of 2005 and renumbered by section 9(a) of Act 21 of 2021]

(2)     Subparagraph (1)(a) does not apply where the duration of the year of assessment in question does not exceed a period of six months.

[Subparagraph (2) added by section 9(b) of Act 21 of 2021]

Paragraph 21 (Fourth Schedule) – Payment of provisional tax by provisional taxpayers (other than companies)

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21.     PAYMENT OF PROVISIONAL TAX BY PROVISIONAL TAXPAYERS (OTHER THAN COMPANIES)

(1)     Subject to the provisions of subparagraph (2), provisional tax shall be paid by every provisional taxpayer (other than a company) in the following manner, namely –

(a)     within the period of six months reckoned from the commencement of the year of assessment in question, one half of an amount equal to the total estimated liability of such taxpayer (as determined in accordance with paragraph 17) for normal tax in respect of that year, less the total amount of-


(i)      any employees’ tax deducted by the taxpayer’s employer from the taxpayer’s remuneration during such period; and


(ii)     any tax proved to be payable to the government of any other country which will qualify as a rebate under section 6quat; and


(b)     not later than the last day of the year of assessment in question, an amount equal to the total estimated liability of such taxpayer (as finally determined in accordance with paragraph 17) for normal tax in respect of that year, less the total amount of-


(i)      any employees’ tax deducted by the taxpayer’s employer from the taxpayer’s remuneration during such year and the amount paid in terms of item (a); and


(ii)     any tax proved to be payable to the government of any other country which will qualify as a rebate under section 6quat.

(1A)  Subparagraph (1)(a) does not apply where the duration of the year of assessment in question does not exceed a period of six months.

[Subparagraph (1A) inserted by section 8 of Act 21 of 2021]

(2)     If the Commissioner has in terms of section 66(13A) of this Act agreed to accept accounts from any provisional taxpayer in respect of any year of assessment drawn to a date falling after the end of such year, the period referred to in item (a) of sub–paragraph (1) shall, notwithstanding the provisions of that sub–paragraph, be reckoned from such date as the Commissioner upon application of the taxpayer and having regard to the circumstances of the case may approve, and in such case the last day of such year of assessment shall for the purposes of item (b) of that subparagraph be deemed to be the day preceding the first anniversary of the said date.

22.  ……….

Paragraph 20A (Fourth Schedule) – Penalty in the even of failure to submit an estimate of taxable income timeously

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20A.  ……….

[Paragraph 20A inserted by section 25 of Act 89 of 1969, amended by section 45 of Act 88 of 1971, section 52 of Act 85 of 1974, section 40 of Act 121 of 1984, section 88 of Act 45 of 2003, section 271 of Act 28 of 2011, section 24 of Act 21 of 2012 and section 14 of Act 39 of 2013 and repealed by section 11 of Act 44 of 2014 effective on 1 March 2015]

Paragraph 20 (Fourth Schedule) – Penalty for underpayment of provisional tax as a result of underestimation

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20. PENALTY FOR UNDERPAYMENT OF PROVISIONAL TAX AS A RESULT OF UNDERESTIMATION

[Heading of paragraph 20 substituted by section 271 of Act 28 of 2011 and section 10 of Act 44 of 2014 effective on 1 March 2014]

(1)     If in respect of a year of assessment the taxable income of a provisional taxpayer, as determined under this Act, is—

(a)     more than R1 million and the final or last estimate of taxable income submitted by that provisional taxpayer in terms of paragraph 19(1)(a) or (b) in respect of that year of assessment is less than 80 per cent of the amount of the provisional taxpayer’s taxable income, the Commissioner must impose a penalty, which is deemed to be a percentage based penalty imposed under Chapter 15 of the Tax Administration Act, equal to 20 per cent of the difference between—

(i)      the amount of normal tax, calculated at the rates applicable in respect of that year of assessment and after taking into account any amount of a rebate deductible in terms of this Act in the determination of normal tax payable, in respect of a taxable income equal to 80 per cent of the provisional taxpayer’s taxable income; and

(ii)     the amount of employees’ tax and provisional tax in respect of that year of assessment paid by the end of the year of assessment; or

(b)     R1 million or less and the final or last estimate of taxable income submitted by that provisional taxpayer in terms of paragraph 19(1)(a) or (b) in respect of that year of assessment is less than 90 per cent of the amount of the provisional taxpayer’s taxable income and is also less than the basic amount applicable to that estimate, as contemplated in paragraph 19(1)(d), the Commissioner must impose a penalty, which is deemed to be a percentage based penalty imposed under Chapter 15 of the Tax Administration Act, equal to 20 per cent of the difference between—

(i)     the lesser of—

(aa)   the amount of normal tax, calculated at the rates applicable in respect of such year of assessment and after taking into account any amount of a rebate deductible in terms of this Act in the determination of normal tax payable, in respect of a taxable income equal to 90 per cent of the provisional taxpayer’s taxable income; and

(bb)   the amount of normal tax calculated in respect of a taxable income equal to such basic amount, at the rates applicable in respect of such year of assessment and after taking into account any amount of a rebate deductible in terms of this Act in the determination of normal tax payable; and

(ii)     the amount of employees’ tax and provisional tax in respect of such year of assessment paid by the end of the year of assessment:

Provided that any retirement fund lump sum benefit, retirement fund lump sum withdrawal benefit or severance benefit received by or accrued to or to be received by or accrue to the taxpayer during the relevant year of assessment shall not be taken into account for purposes of this subparagraph.

[Sub-paragraph (1) amended by section 25 of Act 72 of 1963, substituted by section 29(1) of Act 88 of 1965, by section 47(1)(a) of Act 89 of 1969, by section 44 of Act 88 of 1971 and by section 51(1)(a) of Act 85 of 1974, amended by section 36 of Act 69 of 1975, by section 50 of Act 94 of 1983 and by section 39(1) of Act 121 of 1984, substituted by section 19 of Act 61 of 2008 and by section 24(1)(a) of Act 18 of 2009, amended by section 271 read with paragraph 91(b) of Schedule 1 of Act 28 of 2011, by section 23(a)-(c) of Act 21 of 2012, by section 10(1)(b) and (c) of Act 44 of 2014 and by section 17(a) of Act 23 of 2015 and substituted by section 13(a) of Act 16 of 2016]

(2)     Where the Commissioner is satisfied that the amount of any estimate referred to in subparagraph (1) was seriously calculated with due regard to the factors having a bearing thereon and was not deliberately or negligently understated, or if the Commissioner is partly so satisfied, the Commissioner may in his or her discretion remit the penalty or a part thereof.

(2A)   . . . . . .

[Sub-paragraph (2A) inserted by section 10(1)(d) of Act 44 of 2014, substituted by section 17(b) of Act 23 of 2015 and deleted by section 13(b) of Act 16 of 2016]

(2B)   Any penalty imposed under subparagraph (1) in respect of a year of assessment must be reduced by any penalty imposed under paragraph 27(1) in respect of payment referred to in paragraph 21(1)(b) or 23(1)(b).

[Subparagraph (2B) inserted by section 10(1)(d) of Act 44 of 2014 and substituted by section 16 of Act 18 of 2023]

(2C)   If-

(a)     a provisional taxpayer is deemed in terms of paragraph 19(6) to have submitted an estimate of an amount of nil taxable income due to a failure to submit an estimate by the last day of a period of four months after the last day of the year of assessment; and

(b)     the Commissioner is satisfied that the provisional taxpayer’s failure was not due to an intent to evade or postpone the payment of provisional tax or normal tax,

the Commissioner may remit the whole or any part of a penalty imposed under subparagraph (1).

[Sub-paragraph (2C) inserted by section 10(1)(e) of Act 44 of 2014 and substituted by section 13(c) of Act 16 of 2016]

(3)     ……….

[Subparagraph (3) substituted by section 51 of Act 85 of 1974 and deleted by section 10 of Act 44 of 2014 effective on 1 March 2014]