Kindy confirm whether 1st provisional tax returns need to be filed for newly registered companies which have traded for less than 6 months for the period ending 31 August 2020.
Important:
This answer is based on tax law year ending 28 February 2021.
Answer:
An estimate must be submitted. SARS states, in the current practice generally prevailing (issue 3), that the first period for which the payment of provisional tax becomes due, is the period ending six months from the start of the company’s year of assessment. One can’t use nil, unless that is justified. SARS makes the following statement in the practice generally prevailing: “A nil estimate, based on the premise that the “basic amount” is nil, will not be accepted as an estimate made in respect of a taxpayer’s first year of assessment. A taxpayer in this position does not have a “basic amount” as defined and is required to submit an estimate of the total taxable income in relation to that particular year of assessment.”