Provisional tax

Am I a provisional taxpayer?

Provisional taxpayers are people who earn income in addition to their salary/wage. If you get income such as rental income from a property or other income from a trade, you will always be a provisional taxpayer, even if you also earn a salary. Where you act as director of a company or member of a Close Corporation, you will also qualify as a provisional taxpayer. Certain thresholds are outlined below.

If you just earn a salary then you are a regular taxpayer and don't have to worry about filing provisional tax returns.

Regular taxpayers make their tax contributions to Inland Revenue via PAYE deducted from their monthly salaries/wages. Provisional taxpayers earn additional income from other sources and therefore the deductions of PAYE by their employer may not be sufficient.

Therefore they have to make additional payments to Inland Revenue. Inland Revenue wants provisional taxpayers to avoid paying one large chunk of tax in February, so two (or optionally three) payments are made during the year in August and February. This is achieved through the submission of a Provisional Tax Return for each of the periods. Provisional taxpayers need to submit an Income Tax Return for Individual Salaried Persons/Pensioners (Yellow form) tax return before the end of September each year. Normal taxpayers submit an income tax return for Individual Salaried Persons/Pensioners (Brown or Blue form) every year in June

You are NOT required to register as a provisional taxpayer if:
  • The additional taxable income (i.e. Income less allowable expenses) you earn in a tax year is less than N$5,000 a year;
  • The additional income you earn relates to non-taxable income, for e.g. dividend income or income from capital receipts.
Answer a couple of quick questions from Tim to find out if you are a provisional taxpayer or not.
For more info or questions, see our article What is Provisional Tax? How and when do I pay?

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