Tax planning for the 2026/27 year, while you can still change the outcome

The 2026/27 year of assessment runs from 1 March 2026 to 28 February 2027. Tax planning happens inside that window. By the time a return is being prepared, the year is closed and the arithmetic is fixed.

The numbers you are planning against

Retirement contributions

Contributions to a pension, provident or retirement annuity fund remain deductible up to 27.5% of the greater of remuneration or taxable income, capped at R350 000 a year.

For someone in the top bracket the deduction is worth 45 cents in the rand. Two points are worth knowing. Contributions above the annual cap are not lost — they carry forward and can be deducted in a later year, or set against the tax-free portion of a lump sum at retirement. And an additional contribution before 28 February 2027 is one of the few levers still available late in the year.

Medical scheme credits

The medical scheme fees tax credit for 2026/27 is R376 a month for the main member and the first dependant, and R254 a month for each additional dependant. It is a credit against tax rather than a deduction from income, so it is worth the same to every taxpayer regardless of bracket.

Qualifying out-of-pocket expenses may generate an additional credit, subject to the 7.5% of taxable income floor. Keep the receipts — this is a claim that is routinely verified.

For businesses

Small business corporation rates. If your company meets the requirements, the graduated SBC rates apply instead of the flat 27%, starting at 0% on the first R99 000 of taxable income. The qualifying conditions are strict: gross income below the annual limit, all shareholders natural persons holding no other company shares, and no more than 20% of income from investments or personal services.

Turnover tax. From 1 April 2026 the turnover tax limit rose from R1 million to R2.3 million, and the tax-free band within it from R335 000 to R600 000. For a genuinely small business with thin margins this is worth modelling — turnover tax is calculated on gross turnover, not on profit, so it suits high-margin businesses better than low-margin ones.

Section 12H learnership allowances. Registered learnership agreements attract allowances on commencement and on completion. Businesses that already train staff often qualify without realising it.

Section 13sex residential allowance. If you own five or more new or unused residential units used in the trade, an annual allowance is available.

Timing

Where a deduction is available in either of two years, take it in the year with the higher marginal rate. The decisions that most often move:

• Bringing forward repairs and maintenance, or deferring them, depending on where the profit sits
• Writing off genuinely irrecoverable debtors before year-end rather than after
• Bringing forward the purchase of qualifying assets to claim the wear-and-tear allowance a year earlier
• Making a section 18A donation before year-end, deductible up to 10% of taxable income

The caution attached to all of these: the commercial decision has to make sense on its own. Spending a rand to save 27 cents is not a saving.

Capital gains

Individuals have an annual capital gain exclusion, and the primary residence exclusion was increased in the 2026 Budget from R2 million to R3 million. If you are disposing of an asset near a year-end, the date of disposal decides which year the gain falls into, and that is sometimes worth managing.

What planning cannot fix

No planning survives poor records. Deductions that cannot be supported at verification are not deductions. If the bookkeeping is behind, that is the first thing to fix — everything else is built on it.

These figures reflect the Budget 2026 announcements and are subject to the legislative process. For a decision of any size, get advice on your own circumstances before acting.