What South African SME Employers Need to Know About the 2025 Draft Tax Bills

If you’re running a small or medium business in South Africa, the recent publication of the 2025 Draft Tax Bills is something you need to pay attention to. The National Treasury released these draft bills on August 16, 2025, and they are open for public comment until September 12. These bills include important changes that could impact your payroll and tax compliance in the coming years.

So, what’s new and why should you care?

First off, the draft bills introduce changes targeting tax compliance and administration, with an emphasis on closing loopholes and clarifying existing tax laws. One of the most discussed changes is the removal of exemptions on foreign retirement benefits for South African residents. This means if you or your employees receive retirement income from overseas, it may now be taxable here, affecting how you manage payroll deductions.

There are also updates to how businesses can apply assessed losses — basically how you handle business losses to reduce taxable income. This could affect your tax calculations and payroll tax planning.

VAT regulations are getting a refresh, along with tweaks to carbon tax and customs procedures. If your business deals with imports or environmentally-related taxes, these updates deserve your attention.

For payroll specifically, the draft law reinforces the importance of accurate, timely SARS filings and tax submissions. This means reliable payroll software that automates PAYE, UIF, SDL, and other statutory deductions is crucial to stay compliant and avoid penalties.

While these bills are still drafts, it’s smart to start familiarizing yourself with the changes and preparing your payroll and finance teams. Consulting with your payroll software provider about compliance updates is a good idea too.

At Panda Payroll, we’re keeping a close eye on these developments and continuously updating our software to help South African businesses like yours stay ahead of compliance requirements—reliably and affordably.

Stay tuned for more updates, and if you’re not yet using automated payroll software, now’s the perfect time to explore options that can save you time, reduce errors, and keep you compliant with SARS.

Useful Links for Your Reference:

• 2025 Draft Tax Bills and Draft Regulations – National Treasury (PDF)
• South African Revenue Service – Draft Taxation Laws Amendment Bill 2025 (PDF)
• National Treasury Official Website
• SARS Draft Documents for Public Comment