New tax tables for 2017: this is how much you will pay
Following the announcement of new tax changes for the 2017/18 financial year by finance minister Pravin Gordhan, the country’s tax tables have been updated.
One of the biggest changes announced by the finance minister is the introduction of a new tax bracket, aimed at the country’s wealthy.
South Africans who earn more than R1.5 million a year will form part of a new tax bracket which will be taxed at 45%, on top of limited bracket-creep relief for existing tax brackets.
Together these changes are expected to raise and additional R16.5 billion in tax revenue, which will cover a large bulk of the R28 billion shortfall. The other R11.5 billion will come form other sources, Gordhan said.
These other sources include:
- An increase in the dividend withholding tax rate from 15% to 20%, to raise R6.8 billion;
- A 30 cent per litre increase in the general fuel levy and a 9 cent per litre in the road accident levy;
- An increase in the excise duties of alcohol and tobacco – the so-called ‘sin tax’ – of between 6% and 10%.
This is how the new tax tables look:
| Taxable income | Tax rate |
|---|---|
| Under R189 880 | 18% of taxable income |
| R189 881 – R296 540 | R34 178 + 26% of taxable income above R189 880 |
| R296 541 – R410 460 | R61 910 + 31% of taxable income above R296 540 |
| R410 461 – R555 600 | R97 225 + 36% of taxable income above R410 460 |
| R555 601 – R708 310 | R149 475 + 39% of taxable income above R555 600 |
| R708 311 – R1 500 000 | R209 032 + 41% of taxable income above R708 310 |
| R1 500 001 and above | R533 625 + 45% of taxable income above R1 500 000 |
These are the updates to the tax rebates and tax thresholds for 2017/18
| Rebate | Amount |
|---|---|
| Primary | R13 635 |
| Secondary (persons 65 and older) | R7 479 |
| Tertiary (persons 75 and older) | R2 493 |
| Age | Threshold |
| Below age 65 | R75 750 |
| Age 65 to below 75 | R117 300 |
| Age 75 and older | R131 150 |
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