For an entrepreneur, growth isn't only about selling more — it can also mean more accounting, reporting and compliance. The higher thresholds give qualifying small businesses additional room before moving into more complex tax arrangements, but "qualifying" matters: turnover below R2.3 million doesn't automatically mean a business qualifies for every small-business tax benefit.
Source: SARS — SMME Connect, April 2026
Frequently Asked Questions
When did the new VAT threshold take effect?
The R2.3 million compulsory VAT threshold took effect on 1 April 2026.
Did the Turnover Tax threshold also change?
Yes — the qualifying ceiling increased to R2.3 million alongside the tax-free portion rising to R600,000.
Does the change mean every small business pays less tax?
No — the effect depends on the business's circumstances and which tax system applies.