Company tax calculator
The same profit is taxed three different ways depending on how your business is set up. A company pays a flat 27%. A small business corporation (SBC) pays on a table that starts at 0%. A sole proprietor pays personal income tax. Enter your taxable profit and see all three side by side on the 2026/27 rates. Nothing you enter leaves this page.
How the three routes differ
A private company, a (Pty) Ltd, pays income tax at 27% on every rand of taxable profit. There is no tax-free band. If the company then pays that after-tax profit to you as a dividend, dividends tax of 20% is withheld on the way out. Together that is about 41.6% of the original profit gone before it reaches your account.
A small business corporation is still a company, but SARS (the South African Revenue Service) taxes it on a softer table. For a financial year ending between 1 April 2026 and 31 March 2027, the first R99 000 is tax free, then 7% up to R365 000, then 21% up to R550 000, then 27% above that. To qualify, turnover must be R20 million or less, all shareholders must be natural persons who hold no other shares, and not more than 20% of income may come from investments or personal services. Paying a dividend from an SBC still attracts the 20% dividends tax.
A sole proprietor is not a company at all. The profit is your personal income and is taxed on the individual tables, with the normal rebate. Small profits often attract less tax this way, but you have no limited liability and your personal assets are on the line.
Paying yourself a salary is deductible for the company, so if you draw all the profit as salary the company pays no tax and you pay personal income tax on the salary. That is why "salary" gives the same number in all three columns. The calculator assumes you are under 65 and has no other income.
Frequently asked questions
What is a small business corporation?
A small business corporation (SBC) is a company or close corporation that meets SARS's tests: turnover of R20 million or less, all shareholders are natural persons who hold no shares in other companies, not more than 20% of income from investments or personal services, and it is not a personal service provider. An SBC pays tax on a graduated table starting at 0% instead of the flat 27%.
Is a company always cheaper than a sole proprietor?
No. On small profits a sole proprietor often pays less, because the personal tax threshold and rebates apply. A company pays 27% from the first rand, and if you then pay yourself a dividend, another 20% dividends tax comes off. The SBC table changes that picture, which is why it is worth comparing all three.
Does a company pay tax on the salary it pays the owner?
No. A salary is a business expense, so it reduces the company's taxable profit. The owner then pays personal income tax on the salary through PAYE. Taking all the profit as salary usually means the company pays no tax and you pay personal tax on the lot.
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Keep exploring
Company rate and SBC table from SARS, "Companies, Trusts and Small Business Corporations (SBC)", and personal rates from "Rates of tax for individuals", sars.gov.za, for the 2027 tax year (1 March 2026 to 28 February 2027). Estimate only. SARS decides whether a company qualifies as an SBC.