Tax Deductions and Credits for Individuals in South Africa (2026/27)

A deduction reduces taxable income; a credit reduces the tax calculated on that income. That difference explains why a retirement contribution and a medical premium affect your return in different ways. Neither makes ordinary living costs tax deductible.

This guide uses 2026/27 figures for planning from 1 March 2026 to 28 February 2027. The 2026 filing season normally assesses 2025/26. Use the rates and certificates for the year being filed, rather than applying this year's increased limits to an older return.

Start from the SARS individual deductions page. Then check each category against your circumstances and evidence. A claim that applies to a self-employed person may not be available to someone earning only a salary. A list of possible deductions is a starting point, not blanket permission to claim every item.

The retirement contribution percentage limit is 27.5% of the greater of relevant remuneration or taxable income. The 2026/27 annual cap is R430,000, compared with R350,000 in 2025/26. These figures come from our tax-year config and match the SARS Budget 2026 FAQ.

All eligible pension, provident and retirement annuity contributions share that limit. An employer contribution treated as a taxable fringe benefit may be treated as your contribution for this purpose. Check the IRP5 and fund certificates before adding amounts together; do not add the same employer contribution a second time.

The legal calculation has exclusions from the relevant income bases and an additional taxable-income limitation, including specific treatment of lump sums and taxable capital gains. The SARS ITR12 guide, section 10.3, sets out those details. Our simple salary examples assume ordinary remuneration with no capital gains or retirement lump sums.

For an annual salary of R400,000, the percentage limit is R110,000. An RA payment of R40,000 therefore fits within the common-case limit. It reduces taxable income to R360,000, rather than subtracting R40,000 directly from the tax bill.

This saving is generated by the same engine as the income tax calculator. The contribution crosses a bracket boundary, so multiplying the whole payment by one marginal rate would not reproduce the result. Your refund also depends on PAYE already paid; a tax saving and a refund are different amounts.

Eligible excess contributions carry forward for later consideration. Keep the assessment record of unused contributions and the underlying certificates. You cannot claim the full excess again simply because a new year started; that year's limits and other applicable treatment still matter. The retirement calculator helps you compare contributions with the ordinary annual limit.

Do not deduct all your medical premiums from salary. Qualifying scheme payments can give a section 6A credit, and eligible expenses plus excess fees can give a section 6B credit. Both reduce normal tax, subject to the non-refundable limitation. See SARS medical credits.

The result depends on contribution months, covered people, income, age and defined disability circumstances. Reimbursed expenses cannot be counted again. Our medical tax credit guide gives current and prior-year rates, the formulas and worked examples. Use the medical credits calculator with your certificate and actual paid expenses.

If you paid contributions for an eligible family member, check who is entitled to claim. Do not duplicate a full family certificate across both spouses. Check monthly member changes separately when your certificate lists different covered people during the year.

A qualifying donation to an approved institution can be deducted subject to the section 18A limit. The ordinary limit is 10% of the relevant taxable income before the donation deduction, after other relevant deductions, with the exclusions explained in SARS's ITR12 guide, section 10.7.2. Excess qualifying donations can carry forward.

For example, if the relevant taxable income before donations is R360,000, ten percent is R36,000. A qualifying cash donation of R10,000 is below that limit. This means the eligible donation can reduce taxable income; it does not mean SARS pays back R10,000.

Keep the valid section 18A receipt and payment evidence. Check the organisation's approval and the receipt details; being an NPO or doing charitable work does not alone establish section 18A eligibility. SARS's section 18A guidance explains certificate and third-party data requirements. Donations already shown on an IRP5 should not be captured a second time as a separate payment.

This income-tax deduction is distinct from donations tax, a different tax on certain transfers. Do not use a donations-tax exemption as the income-tax deduction limit. Gifts to friends or family do not become section 18A donations merely because they were generous.

A travel allowance can support a deduction for qualifying business use of a private vehicle on assessment. Keep the opening and closing odometer readings, business trip dates, destinations, reasons and kilometres. Ordinary commuting between home and your regular place of work is private travel. See the SARS travel e-logbook guidance.

Match the claim to the vehicle, allowance and tax year. A business-distance estimate made at filing time is not a substitute for a logbook. Where actual costs are used, keep the supporting records; the SARS cost-scale method has its own requirements. Do not simply subtract all fuel receipts or all instalments from your salary.

A company car benefit and a reimbursive allowance are not the same as a fixed travel allowance. The company car calculator explains the common benefit calculation. Travel logbook claims are not included in our basic refund estimator, so it may differ from a return containing a travel deduction.

Working at home is not enough. SARS requires a specifically equipped space used regularly and exclusively for trade. A salary employee must perform more than half their duties there; employees whose remuneration is mainly qualifying commission or variable payments have a different work-location test. Read the SARS home office conditions before calculating a claim.

If eligible, premises-related costs are generally apportioned using office floor area relative to the home's total area. Costs still need to qualify. A room used for family activities as well as work does not automatically meet exclusive use, and capital improvements are not treated like ordinary repairs. SARS also explains that mortgage interest is no longer deductible for an employee's home office from the relevant 2023 assessment treatment onward.

Retain floor-area measurements, cost records and evidence of the working arrangement. Equipment wear and tear requires its own treatment rather than automatically using the premises percentage. A claim can affect capital gains treatment when the home is sold; examine that consequence alongside the annual deduction.

Home office claims are not included in the basic refund calculator. Do not force the expense into its retirement or donation field to simulate a result. Check the complete calculation with the SARS guidance or a practitioner when the claim is material.

Employment and business deductions have different restrictions. A mainly commission-based employee may have access to qualifying trade expenses that a salary employee cannot deduct. A self-employed person must distinguish expenses incurred in producing income from private spending and capital costs. The SARS deductions page and ITR12 guide explain the categories.

Keep business records that connect costs to the income-producing activity. Apportion mixed private and business use on a supportable basis. The fact that a bank statement shows a payment does not establish its tax treatment. For a freelance activity, work out eligible net profit rather than treating gross receipts as take-home pay or claiming all personal expenses against them.

• Normal groceries, private rent, clothing and commuting are not general salary deductions.
• A receipt does not make a payment eligible without the legal conditions.
• Medical premiums are not deducted in full from income.
• Every donation is not a section 18A donation.
• Working occasionally at a dining table does not automatically create a home office deduction.
• The retirement annual cap does not guarantee that every taxpayer may deduct that amount.
• An amount already claimed through employer or third-party records cannot simply be added again.

Where a cost has both business and private purposes, first identify whether any deduction is allowed for your category of taxpayer. Only then calculate the eligible part. Treat advice framed as “claim everything” cautiously and check the specific SARS rule.

Gather all IRP5/IT3(a) certificates, retirement fund certificates, scheme certificates and medical receipts, section 18A receipts, and any logbook or home office evidence. Keep proof of payment and notes explaining allocations. Reconcile the records before entering a total, especially if the same contribution appears in more than one document.

Use the tax refund calculator to compare the common deductions and credits with PAYE paid. Select the year being assessed, enter the relevant income, and inspect each calculation step. Review the filing hub for deadlines and submission steps. For rates and age rebates, use the 2026/27 tax tables.

Before submission, compare the calculated liability with the return calculation and investigate differences. Missing income, an incorrect year or a duplicate deduction can affect the outcome more than a small rounding difference. Save the submitted return and assessment, and respond through official SARS channels if supporting documents are requested.

• SARS individual deductions
• SARS Budget 2026 FAQ: retirement limits
• SARS ITR12 guide: retirement and section 18A
• SARS medical credits
• SARS travel logbook
• SARS home office expenses
• SARS section 18A certificates