Finance

End of the line for taxpayers in South Africa

Staff Writer

 ·20 Oct 2025

Monday, 20 October, marks the final day for non-provisional taxpayers to file their tax returns for the 2025 tax season, with the South African Revenue Service warning of fines and penalties if not done in time.

The revenue service noted last week that approximately 850,000 South African taxpayers had not yet filed their returns by Friday.

Any stragglers have until the end of today to submit.

In the 2024 tax year, over 6.7 million non-provisional taxpayers filed their income-tax returns, including those who were auto-assessed.

In 2025, SARS noted that 7.9 million non-provisional taxpayers had already filed their tax returns out of the 8.7 million or so expected. 6 million had been auto-assessed.

However, the taxman also made it clear that it would pursue those who shirked their obligations.

Except for specific circumstances—such as those earning less than R500,000 a year—South Africans are legally obligated to file their taxes. Failure to do so could result in fines and penalties.

“Failure to submit a return by the deadline is a serious offence, and non-compliance can lead to administrative penalties and interest charges,” SARS said.

“As part of our strategic focus to encourage voluntary compliance and enforce the law, SARS will continue to identify and act against those who do not meet their tax obligations.”

SARS is under immense pressure to collect more taxes this year, having bargained with the National Treasury to collect at least an additional R20 billion in revenue.

In return, the Treasury gave SARS an additional R7.5 billion to help facilitate these collections.

Unfortunately for SARS—and for taxpayers—this goal is not going so well.

National Treasury data at the start of the month revealed that the revenue service is falling short of its goal to collect an extra R35 billion in tax revenue this year.

More positively, despite lagging behind projections required to secure the additional revenue, SARS is at least on track to meet its 2025/26 baseline target.

The taxman has collected approximately R39.3 billion so far this fiscal year, surpassing the R37.5 billion needed to meet its baseline goal of R100 billion, which it achieved in the 2024/25 fiscal year.

However, the collections fall short of the R49.3 billion needed to stay on course for the higher target aimed at easing fiscal pressures.

The downside for taxpayers is that, if the revenue service misses the goal, harsher tax measures could be coming in 2026.

Tax season 2025 dates

Harsher tax measures on the way

Finance Minister Enoch Godongwana has already warned that spending cuts may be unavoidable if revenue fails to meet expectations.

The 2025 budget, published after many delays in May, also showed that taxpayers are on the hook for R20 billion in additional tax measures in 2026.

Earlier this year, Godongwana said exceeding the collection target could eliminate the need for an additional R20 billion in taxes planned for 2026/27, as the government seeks to contain debt projected to peak at 77.4% of GDP.

SARS was allocated an additional R7.5 billion over the medium term in the 2025 budget, which was expected to bring in R20 billion to R50 billion in additional collections.

The tax service believes there is a haul of over R300 billion in uncollected tax that it could tap into to boost revenue.

But if it fails in this task, then the burden will be saddled onto taxpayers, who are already suffering under the weight of high taxes.

Godongwana attempted to boost taxes this year by hiking VAT to 17% in his first attempt at the budget in February.

This was widely rejected, resulting in a second budget looking to hike VAT to 16% over two years.

While the ANC managed to secure enough votes to pass this budget with the help of Action SA and Build One South Africa, a court challenge by the DA and EFF saw the attempted VAT hike scuppered.

This resulted in the third and eventually final budget for the year with no VAT hike, but a glaring hole in revenue collections.

Without the easy tax swipe of a VAT hike, the National Treasury was forced to find tax revenue from other sources.

This included increasing the general fuel levy and not adjusting tax brackets or medical aid tax credits for inflation.

Treasury gets bombarded with tax ideas from various sectors of the economy every year—from wealth taxes to ‘apartheid redress’ taxes.

Godongwana has previously waved away direct income taxes and wealth taxes as a way to boost revenue, acknowledging that taxpayers are overtaxed.

However, there are a few direct and indirect taxes that remain in play.

These include not adjusting tax brackets for inflation, the cutting or removal of tax rebates and incentives. Hikes to fuel levies are also an option.

All these levers were pulled in 2025, and could again arise in 2026, if SARS does not find the extra billions.