Nobody wants to pay more tax than they need to. The good news is that South Africa’s tax system provides a range of rebates, deductions and incentives that can reduce your tax liability, provided you qualify and claim them correctly.

As F.J. Raymond famously put it: “Next to being shot at and missed, nothing is quite as satisfying as an income tax refund.”

The challenge is knowing which tax benefits apply to your circumstances and making sure they are correctly reflected in your 2026 tax return.

We’ve highlighted some of the key rebates, deductions and incentives individuals and businesses should have on their radar this tax season. This is by no means an exhaustive list, and eligibility requirements apply.

Tax relief for individuals

Tax rebates and thresholds

Thanks to the primary, secondary and tertiary rebates available to individual taxpayers, you only start paying income tax once your taxable income exceeds the applicable threshold.

For the 2026 tax year, the threshold is R95,750 for taxpayers under 65, R148,217 for those aged 65 to 74, and R165,689 for taxpayers aged 75 and older.

These rebates are applied automatically when calculating your tax liability, provided you meet the relevant requirements.

Medical tax credits

If you belong to a registered medical scheme, you may qualify for monthly medical scheme fees tax credits.

For the 2026 tax year, the credit is R364 per month for the taxpayer and another R364 for the first dependant, with R246 per month for each additional dependant.

Additional medical expense relief may also be available, depending on your age, disability status, medical scheme contributions and qualifying out-of-pocket medical expenses.

The calculation can be complex, so it is worth checking that you are receiving the full benefit to which you are entitled.

Interest exemption

Interest earned from a South African source can be exempt from income tax up to an annual limit of R23,800 for taxpayers under 65. For taxpayers aged 65 and older, the exemption increases to R34,500.

This exemption can help reduce the taxable portion of interest earned on savings and investments.

Retirement fund contributions

Contributions to a registered pension, provident or retirement annuity fund may be deductible up to 27.5% of the greater of your taxable income or remuneration, subject to the applicable annual limit of R350,000.

This can be one of the most effective ways to reduce your taxable income while simultaneously building towards long-term financial security.

Tax-free savings accounts

Tax-free savings accounts offer another way to invest without paying tax on the returns generated within the account.

Interest, dividends and capital gains earned in a qualifying tax-free investment are exempt from tax, subject to the applicable contribution limits.

For the 2026 tax year, the annual contribution limit was R36,000, with a lifetime contribution limit of R500,000.

Working from home

If you regularly work from home and have a dedicated area of your home used specifically for your trade, you may be able to claim certain home-office expenses.

Depending on your circumstances, these may include a portion of rent, utilities, rates and taxes, as well as wear-and-tear on qualifying office furniture and equipment.

However, the requirements are specific, and claiming a home-office deduction can have other tax implications. It is therefore important to understand the rules before making a claim.

Donations

Donations made to qualifying Section 18A-approved organisations may be deductible up to 10% of taxable income, subject to the requirements of the Income Tax Act.

Where qualifying donations exceed the annual limit, the excess may generally be carried forward to the following tax year.

Tax incentives for businesses

Businesses can also benefit from a range of deductions and incentives designed to encourage investment, skills development, research and economic growth.

Small Business Corporations

Qualifying Small Business Corporations (SBCs) can benefit from a range of tax concessions.

These include a progressive tax rate and accelerated capital allowances, including the potential immediate write-off of qualifying new plant and machinery used directly in the production of income.

Other depreciable assets may qualify for accelerated wear-and-tear allowances.

The potential tax saving can be significant, making it important for qualifying businesses to ensure they are being assessed under the correct tax rules.

Turnover tax for micro businesses

Certain qualifying micro businesses with an annual turnover of R1 million or less may be eligible for the simplified turnover tax system.

Turnover tax can replace several taxes that would otherwise apply, including normal income tax and Capital Gains Tax, subject to the relevant exclusions and requirements.

It can provide a simpler approach to tax compliance for qualifying small businesses, although it is not necessarily the best option for every business.

Manufacturing incentives

Certain manufacturing businesses may qualify for accelerated depreciation allowances on manufacturing machinery and other qualifying assets.

Additional incentives may also apply to assets used in renewable energy production, depending on the nature of the investment and the applicable legislation.

Learnership incentives

Employers who enter into qualifying learnership agreements registered with a SETA may qualify for additional deductions over and above the actual cost of providing training.

This provides a valuable opportunity for businesses to invest in employee development while potentially reducing taxable income.

Research and development

Qualifying research and development expenditure may qualify for enhanced tax deductions, including a 150% deduction for qualifying R&D expenditure.

Accelerated depreciation allowances may also be available for qualifying R&D machinery and capital assets.

For businesses investing in innovation, this can make a meaningful difference to the overall cost of developing new products, processes or technologies.

Other incentives worth knowing about

Depending on the nature and location of your business and the type of investment being made, other tax incentives may also be available.

These include the Urban Development Zone allowance, incentives relating to Special Economic Zones, which can include a reduced corporate income tax rate of 15% for qualifying companies, and certain building allowances for qualifying new and unused buildings and improvements.

Business owners should also consider the tax implications of selling a business. In certain circumstances, entrepreneurs aged 55 and older may qualify for specific Capital Gains Tax relief when disposing of a business, subject to the relevant requirements and limits.

Do you qualify for tax relief?

These are only some of the rebates, deductions and incentives available to South African taxpayers.

The difference between an ordinary tax outcome and a more favourable one often comes down to understanding which provisions apply to your specific circumstances and ensuring that every legitimate claim is supported and correctly calculated.

Tax legislation also changes regularly, making it important to work with professionals who keep up with the latest requirements.

At BGR, our tax team can review your individual or business circumstances, identify applicable rebates and deductions, and help ensure your tax affairs remain fully compliant while you make use of every legitimate tax benefit available to you.

Don’t pay more tax than you need to. Get in touch with BGR to discuss your tax position this filing season.