What Every Startup in Johannesburg Needs to Know About Tax Registration

Starting a business in Johannesburg is exciting — but once the CIPC registration is done, the tax obligations start almost immediately. Many startups in Gauteng miss critical registration deadlines in their first few months, which leads to penalties, back-taxes, and unnecessary stress.

This guide breaks down everything your new business needs to register for — and when.

Income Tax — It Starts at Registration

The moment your company is registered with CIPC, SARS is automatically notified. Your company receives an income tax reference number as part of the registration process — so there is nothing extra to do here. What you do need to do is file your first ITR14 (company income tax return) at the end of your financial year.

Quick tip: Your financial year-end is chosen at CIPC registration. Choose it wisely — a February year-end aligns with the SARS tax season and makes compliance easier.

Provisional Tax — Don’t Wait for Year-End

If your company earns income that is not subject to PAYE (which applies to almost all startups), you must register for provisional tax. This means paying tax in advance — twice a year — based on your estimated income.

The two submission periods are:

• First period — due 6 months into your financial year
• Second period — due at the end of your financial year

Missing these deadlines triggers automatic penalties. A registered Tax Practitioner can help you calculate the right amount and file on time.

VAT — Only Once You Cross the Threshold

You are NOT required to register for VAT until your taxable turnover reaches R2.3 million in any 12-month period (updated in the 2025/26 Budget). However, you can register voluntarily before that — which can be beneficial if your clients are VAT-registered businesses.

Important: Registering for VAT too early can create cash flow pressure for a startup. Get advice before registering voluntarily — it is not always the right move.

PAYE — The Moment You Hire

The moment you hire, three obligations may kick in. Unemployment Insurance Fund (UIF) applies to any employee working more than 24 hours per month for the same employer — regardless of what they earn. PAYE (Pay As You Earn) applies where an employee’s remuneration becomes taxable under SARS tax tables, which typically occurs once earnings exceed the applicable annual tax threshold after rebates — currently around R95,750 per year for employees under 65. SDL (Skills Development Levy) applies once your total annual payroll is expected to exceed R500,000. Each registration must happen before your first payroll run.

Failing to register and deduct correctly is one of the most common and costly mistakes we see with growing Johannesburg startups.

What Happens if You Miss a Registration?

SARS charges administrative penalties for late registration and late submission. These are calculated as a percentage of your outstanding tax and accumulate monthly. The longer you wait, the more it costs.

The good news: SARS has a Voluntary Disclosure Programme (VDP) that allows businesses to regularise their tax affairs before SARS finds them — often with reduced penalties.

Get Your Tax Registrations Right From Day One

At Sikatrix Business Accountants in Alberton, we help startups and new businesses across Gauteng get compliant from day one — so you can focus on growing, not paperwork. We handle income tax, provisional tax, PAYE, VAT, and CIPC registrations. One call is all it takes.

Contact us today at sikatrix.com/contact