What to Know About Filing Season 2026 Changes
Ring-Fencing Assessed Losses – Section 20A Amendment
- For years of assessment commencing on or after 1 March 2026, section 20A (ring-fencing of assessed losses) now applies from a marginal tax rate of 39%, not the previous full maximum rate of 45%. (sars.gov.za)
- This means businesses or individuals whose taxable income falls below thresholds where 39% applies can carry forward assessed losses in many cases where previously they could not. It tends to ease the burden on smaller high-margin traders. (sars.gov.za)
Auto-Assessments and Deadlines
- Auto-Assessment Notices issued between 1–12 July 2026 for individuals and some trust taxpayers. If you're auto-assessed and agree with the outcome, you do not need to file. If you disagree, you may correct and submit your return before 23 October 2026 (for individuals/trusts) or 22 January 2027 (for provisional taxpayers). (sars.gov.za)
- New line items in ITR12 forms for:
- Declared interest income per account including DTA / section 10(1)(h) reliefs. (sars.gov.za)
- Assets disposed in partnership for CGT purposes (non-primary residence) to be disclosed. (sars.gov.za)
- A newly introduced Recognition of Transfer (ROT) validation: Returns can be rejected if a lump sum transfer or annuity purchase involves retirement funds where the receiving fund fails to send an ROT to SARS. (sars.gov.za)
Compliance Tips and Dos & Don’ts
- Double-check auto-assessment notices: While SARS aims to simplify compliance via auto-assessment, you must review them—errors in third-party data do occur.
- Prepare supporting documents: Especially for interest expenses Claimed under section 10(1)(h) or reliefs under DTAs, make sure you have per-account documentation.
- For dispositions of non-primary residence assets via partnership, document your share of disposals and retain evidence to avoid CGT surprises.
- Watch financial year start dates: The ring-fencing change applies from assessment years on or after 1 March 2026.
Example Case
Freelancer Tambo made R2.5 million in taxable income during 2025/26 and incurred assessed losses in previous years. Under the old rule (45% rate), ring fencing prevented using those losses due to lower marginal rates. Under the new 39% rate benchmark, Tambo can use more of those losses to reduce their current tax burden.
Meanwhile, Trustee Lindiwe with simple income and no deductions received an auto-assessment notice on 5 July 2026. She agreed with the computed income, so she didn’t file. However, later she noticed a missing DTA relief line—she was able to correct before the deadline.
Action Steps Before Filing Deadline
- Log into SARS eFiling or the MobiApp to check whether you are auto-assessed or need to file.
- Collect transaction-level statements for all bank accounts and taxable supplies, especially interest income.
- If disposing property through a partnership, assemble agreements, deeds and records of your share.
- If unsure about qualifying loss carry-forward under section 20A, consult a tax professional.
Outcomes: These changes make the system fairer for many mid-to-lower income earners, reduce administrative overhead, and place more emphasis on accurate reporting rather than punitive correction.
Sources: SARS Filing Season Changes announcement. (sars.gov.za)