South African Income Tax Rates from 1981 to 2007

Individuals

Putting this table together involved delving into a history of multiple rebates, capped variable rebates with deemed minimums, multiple tax tables, discrimination on the basis of race, and discrimination on the basis of marital status. Discrimination on the basis of race was repealed with effect from 1984/5 but discrimination on the basis of marital status lived on for just over another decade. It reached the stage that separate tax tables were used depending on whether you were a “married person”, “person not a married person” or a “married woman”. Wives were expected to include their taxable income in their husbands’ tax returns. Unless a polygamous marriage was involved, in which case only the longest married wife’s income was included. A widow or widower was still a married person but a divorced person was, usually, not. As the 1984-5 Supplement to Silke on South African Income Tax put it; “One could say, in fact that a married woman is ‘married’ but not a ‘married person’ unless she is divorced (but the true position is even more complicated)!”

Discrimination on the basis of marital status conflicted with the Bill of Rights of the Interim Constitution and was repealed as soon as practical after its promulgation. This change was eased by the work that already had been put into the separation of husband and wife for income tax purposes from 1990 onward. Individuals are now taxed on their own income using a single tax table. Rules exist to allocate income in spousal relationships in community of property. Marriages, customary marriages, religious marriages, and permanent same-sex or heterosexual unions give rise to a spousal relationship between the participants for tax purposes. The last two categories of spousal relationship are considered to be out of community of property unless proven otherwise.

In order to keep the comparisons manageable, the tax tables and rebates applicable to a single person with no dependants have been used for years before 1995/6.

Fiscal
Year
First Tax
Threshold
Second Tax
Threshold
Third Tax
Threshold
Minimum Rate Minimum Rate
Bracket
Maximum Rate Maximum Rate
Threshold
Brackets Loan Levy/
Surcharge
Notes
1980/1 1 500 3 000 9.6% 6 000 50% 28 000 17 1,2,3
1981/2 1 500 3 000 4 000 9.6% 6 000 50% 28 000 17 1,2,3,4
1982/3 2 650 3 850 4 650 12% 7 000 50% 28 000 16 5% 1,3,4
1983/4 2 650 3 850 4 650 12% 7 000 50% 28 000 16 1,3,4
1984/5 3 375 4 375 5 875 14.4% 8 000 50% 28 000 15 1,3,4
1985/6 4 031 4 781 7 156 16% 10 000 50% 42 000 21 7% 3,5,6
1986/7 4 232 4 982 7 357 16% 10 000 50% 42 000 21 -5% 3,5,7
1987/8 4 500 5 300 7 833 15% 10 000 45% 42 000 18 3,5
1988/9 5 357 6 214 8 929 14% 10 000 45% 54 000 19 3,5
1989/1990 6 071 6 928 14 783 14% 10 000 45% 54 000 19 3,5
1990/1 10 285 10 857 18 889 15% 4 000 44% 56 000 14 5,8,9
1991/2 10 357 10 929 19 500 14% 5 000 43% 56 000 12 5,8
1992/3 10 714 11 285 21 429 17% 5 000 43% 56 000 9 5,8
1993/4 10 714 11 285 21 429 17% 5 000 43% 56 000 9 5,8
1994/5 10 714 21 429 17% 5 000 43% 56 000 9 3.33% 10,11
1995/6 14 605 26 786 17% 5 000 45% 80 000 10 1.67% 10,11,12
1996/7 15 580 27 905 17% 15 000 45% 100 000 8 11,12
1997/8 16 921 30 050 19% 30 000 45% 100 000 7 11,12
1998/9 18 500 31 950 19% 31 000 45% 120 000 6 11,12
1999/2000 19 526 33 717 19% 33 000 45% 120 000 6 11,12
2000/1 21 111 36 538 18% 35 000 42% 200 000 6 11,12
2001/2 23 000 39 154 18% 38 000 42% 215 000 6 11,12
2002/3 27 000 42 640 18% 40 000 40% 240 000 6 11,12
2003/4 30 000 47 222 18% 70 000 40% 255 000 6 11,12
2004/5 32 222 50 000 18% 74 000 40% 270 000 6 11,12
2005/6 35 000 60 000 18% 80 000 40% 300 000 6 11,12
2006/7 40 000 65 000 18% 100 000 40% 400 000 6 11,12
Notes
  1. Single persons’ rates were calculated by using the married persons’ tax table for income up to R28 000, deducting the applicable rebates, and adding a 20% surcharge. Taxable income over R28 000 was taxed at a flat 50%.
  2. The married persons’ first threshold was R2 500, second threshold R4 000, the minimum rate of 8% applied up to a taxable income of R6 000, the maximum marginal rate of 50% was reached at a taxable income of R40 000, and there were 24 tax brackets.
  3. The second threshold applied to those 60 years of age and older.
  4. The third threshold applied to those 70 years of age and older.
  5. The third threshold applied to those 65 years of age and older.
  6. The surcharge was levied on so much of the net amount of tax, after deduction of all rebates, as exceeded R750.
  7. The discount was based on the net amount of tax after deduction of all rebates.
  8. The qualifying age for the second threshold was increased to 61 years of age in 1990/1 and increased by one year in each year thereafter until it reached 65.
  9. Dividends exempted from income tax. See repeal of UPT for companies below.
  10. A transitional levy was levied on taxable income over R50 000, subject to certain exemptions.
  11. The second threshold applied to those 65 years of age and older.
  12. Single tax table for all individuals.

Individuals – Interest and Dividends Exemption

Fiscal
Year
< 65 65 + Foreign
Permitted
1989/1990 R1 000 R1 000 N/A
1990/1 R2 000 R2 000 N/A
R2 000 R2 000 N/A
2000/1 R3 000 R4 000 All
2001/2 R4 000 R5 000 All
2002/3 R6 000 R10 000 R1 000
2003/4 R10 000 R15 000 R1 000
2004/5 R11 000 R16 000 R1 000
2005/6 R15 000 R22 000 R2 000
2006/7 R16 500 R24 500 R2 500

Prior to 2000/1 no distinction was made on the basis of age.

Individuals – “Blacks”

“Blacks” were taxed in terms of the Taxation of Blacks Act, 1969, until 1983/4. The income of spouses was not added together, there was a single tax table, and there were no rebates.

Fiscal
Year
Minimum Rate Minimum Rate
Bracket
Maximum Rate Maximum Rate
Threshold
Brackets
1980/1 0% 1 800 48% 28 020 29
1981/2 0% 1 800 48% 28 020 29
1982/3 0% 1 800 48% 28 020 29
1983/4 0% 1 800 48% 28 020 29

Corporate – Normal Tax & Surcharges

Fiscal
Year
Normal
Tax
Surcharge Effective
Rate
Notes
1980/1 40% 5% 42%
1981/2 40% 5% 42%
1982/3 42% 10% 46.2%
1983/4 42% 10% 46.2%
1984/5 50% 50%
1985/6 50% 50%
1986/7 50% 50%
1987/8 50% 50% 1
1988/9 50% 50%
1989/1990 50% 50%
1990/1 50% 50%
1991/2 48% 48%
1992/3 48% 48%
1993/4 40% 40%
1994/5 35% 5% Variable 2
1995/6 35% 35%
1996/7 35% 35%
1997/8 35% 35%
1998/9 35% 35%
1999/2000 30% 30%
2000/1 30% 30% 3
2001/2 30% 30% 3
2002/3 30% 30% 4
2003/4 30% 30% 4
2004/5 30% 30% 4
2005/6 29% 29% 5
2006/7 29% 29% 6
Notes
  1. A minimum tax on companies was levied and could be offset against subsequent provisional tax or normal tax. If not utilised it was was refundable on liquidation or 1 October 1991, whichever came first. MTC = 25% x (Dividends distributed during the year – SA normal tax for the year – foreign taxes on income, profits or gains from foreign sources – dividends derived during the year from all sources). There were a number of exemptions, including one for companies which had distributed dividends of less than R250 000.
  2. A transitional levy of 5% was levied on taxable income over R50 000, before taking any assessed loss from the prior year into account.
  3. A small business scale with a reduced rate of 15% for taxable incomes of up to R100 000 was in force. Turnover and shareholding conditions apply. A personal service company, as defined, was taxed at 35%.
  4. A small business scale with a reduced rate of 15% for taxable incomes of up to R150 000 was in force. Turnover and shareholding conditions applied. A personal service company, as defined, was taxed at 35%.
  5. A small business scale with a reduced rate of 10% for taxable incomes of up to R250 000 was in force. Turnover and shareholding conditions applied. A personal service company, as defined, was taxed at 34%.
  6. A small business scale with a reduced rate of 10% for taxable incomes of up to R300 000 was in force. Turnover and shareholding conditions applied. A personal service company, as defined, was taxed at 34%.

Corporate – Undistributed Profits Tax

From To Rate
1980/1981 1989/1990 33.33%

Corporate – Secondary Tax on Companies

Dividend Declared Rate
From To
17/03/1993 21/06/1994 15%
22/06/1994 13/03/1996 25%
14/03/1996 30/09/2007 12.5%
01/10/2007 31/03/2012 10.0%

Comments are closed.