Glossary

The jargon, decoded.

44 terms · checked against SARS, CIPC and Information Regulator sources on 8 October 2026. All official links →

Abridged tax invoice

A shorter tax invoice a VAT vendor may issue when the total is R5 000 or less. It doesn't need the buyer's name, address or VAT number. Official source ↗

Annual return (CIPC)

A yearly filing every company and close corporation must submit to CIPC, starting from the anniversary of registration. If you don't file it, the company can be deregistered. Official source ↗

B-BBEE affidavit (EME)

A sworn statement that an Exempted Micro Enterprise (turnover under R10 million) can use as its B-BBEE certificate. Corporate clients often ask suppliers for one. Official source ↗

Beneficial ownership

The real people who own or control a company. Companies must file this information with CIPC. Official source ↗

BizPortal

The government's online portal for registering a company and adding services such as a tax number and domain name. Official source ↗

CIPC

Companies and Intellectual Property Commission. It registers companies and trademarks. You register a company on BizPortal or the CIPC site. Official source ↗

COIDA

Compensation for Occupational Injuries and Diseases Act. Employers must register with the Compensation Fund once they have employees. Official source ↗

Consumer Protection Act (CPA)

The law that protects consumers in South Africa: fair terms, plain language and quality goods and services. It mostly applies when you sell to individuals, not big businesses. Official source ↗

Cooling-off period (ECT Act s44)

When goods or services are sold online, the buyer can usually cancel within 7 days. Some items are excluded, such as services that have already started and certain digital content. Official source ↗

Domicilium

Short for domicilium citandi et executandi. It's the address a party chooses for receiving legal notices under a contract.

ECT Act s43

Section 43 of the Electronic Communications and Transactions Act lists what an online seller must show: full name and legal status, physical address, contact details, price, and the returns policy. Official source ↗

eFiling

SARS's online platform for registering, filing returns and paying tax. Official source ↗

EMP201

The monthly employer declaration for PAYE, UIF and SDL. It only matters once you employ people. Official source ↗

Income tax number

Your SARS reference number. Every freelancer earning taxable income needs one. You get it automatically when you register on eFiling or through BizPortal. Official source ↗

Information Officer

The person responsible for POPIA compliance in an organisation. In a one-person business, that's you, and you register on the Information Regulator's portal. Official source ↗

Input tax

The VAT you pay on business purchases. You can claim it back if you're a VAT vendor and have a valid tax invoice. Official source ↗

IRP6

The provisional tax return. Most freelancers submit two a year: by 31 August and by the last day of February. Official source ↗

ITR12

The annual income tax return for individuals, including sole proprietors. Official source ↗

ITR14

The annual income tax return for companies. Official source ↗

Operator (POPIA)

Someone who processes personal information for someone else under a contract, such as a freelancer handling a client's customer list. POPIA requires a written agreement and security measures. Official source ↗

Output tax

The VAT you charge your clients (15%). You pay it to SARS after subtracting your input tax. Official source ↗

PAYE

Pay-As-You-Earn: the tax employers withhold from salaries. Freelancers usually aren't on PAYE, which is why they pay provisional tax instead. Official source ↗

Personal service provider

A company or trust whose income really comes from one person working like an employee for a client. It's taxed at a flat company rate with very limited deductions. Official source ↗

POPIA

The Protection of Personal Information Act 4 of 2013. It controls how you collect, use and store people's personal information, including for marketing. Official source ↗

Prescribed rate of interest

The interest rate set by the Minister of Justice under the Prescribed Rate of Interest Act. It's used for late payment when a contract doesn't set its own rate. Official source ↗

Prescription

Under the Prescription Act, most ordinary debts (such as unpaid invoices) lapse after 3 years if you don't take action. Official source ↗

Provisional taxpayer

Anyone who earns income that isn't taxed through PAYE (above small exemptions), plus every company. Official source ↗

Primary rebate

A fixed amount deducted from every individual's tax. It's R17 820 for the 2027 tax year, which means you pay no tax on income up to R99 000 if you're under 65. Official source ↗

Record keeping

SARS generally requires you to keep tax records for five years from the date you submit the return. Official source ↗

s11(a)

Section 11(a) of the Income Tax Act. It lets you deduct expenses incurred in producing income, as long as they aren't capital in nature. Official source ↗

Section 20 (VAT Act)

Sets out what a valid tax invoice must contain, and requires it to be issued within 21 days of the supply. Official source ↗

Section 69 (POPIA)

Controls direct marketing by electronic means. You need prior consent, unless the person is an existing customer and you're marketing similar products with an easy opt-out. Official source ↗

Sole proprietor

Trading in your own name without a separate legal entity. You and the business are the same for tax and liability.

Small Business Corporation (SBC)

A qualifying small company taxed at lower, progressive rates instead of the flat corporate rate. Official source ↗

Tax clearance (TCS)

A tax compliance status PIN from eFiling. Corporate and government clients use it to check you're in good standing with SARS. Official source ↗

Tax year

For individuals, the tax year runs from 1 March to the last day of February. The 2027 tax year is 1 March 2026 to 28 February 2027. Official source ↗

Turnover tax

A simplified tax for micro businesses with turnover up to R1 million a year, which replaces income tax, provisional tax and (optionally) VAT. You must opt in. Official source ↗

UIF

Unemployment Insurance Fund. Employers register and contribute 2% of salaries (1% from the employer, 1% from the employee). Official source ↗

Underestimation penalty

A penalty under paragraph 20 of the Fourth Schedule when your second provisional estimate is too low. If your taxable income is over R1 million, the estimate must be at least 80% of your actual income. People often still call it by its old name, s89quat. Official source ↗

Universal branch code

A single branch code per bank used for all EFTs, e.g. FNB 250655, Standard Bank 051001, Absa 632005, Capitec 470010, Nedbank 198765.

VAT201

The VAT return vendors submit, usually every two months, showing output tax minus input tax. Official source ↗

VAT registration threshold

SARS applies a compulsory threshold of R2.3 million in taxable supplies over 12 months and a voluntary threshold of R120 000, both from 1 April 2026 (previously R1 million and R50 000). Official source ↗

VAT vendor

A business registered for VAT. Registration is compulsory once taxable supplies exceed the threshold in any 12-month period. Official source ↗

Zero-rated supply

A taxable supply charged at 0% VAT. Services exported to clients outside South Africa can often be zero-rated. Official source ↗

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