Reduce your tax

4 EASY ways to reduce your tax contribution. Illustration: Pixabay

4 EASY ways to reduce your tax contribution

It’s too late for the 2023 tax season, but if you want to reduce your tax contribution for next year, here’s how you can start NOW.

Reduce your tax

4 EASY ways to reduce your tax contribution. Illustration: Pixabay

Filing for the 2023 tax season has been open for nearly a month now. You, like many South African taxpayers, are probably looking into ways to reduce your tax contribution for the coming year.

Thanks to tax experts, TaxTim, here are four ways you can reduce your tax contribution for 2024. Everyone’s tax affairs differ, so not all may be applicable to you. But some of the recommendations may be able to save you thousands of Rands over the course of the year.


As we detailed in our story about what to do if you owe SARS money, you’re taxed on any earnings from investments and very often SARS under-taxes these throughout the year. Meaning you’ll end up owing the taxman when you complete your tax return.

ALSO READ: Here’s why you MUST complete a tax return even if you earn less than R500 000

Almost all financial institutions offer these tax-free accounts – Investec, Santam, Discovery, Old Mutual, etc – and they’re comprised of a combination of unit trusts, fixed deposits, bonds and other financial products.

ALSO READ: The REAL reason why your tax refund isn’t bigger

Crucially, the interest and dividends earned is tax free up until a certain limit: R36 000 per tax year and lifetime limit of R500 000. The critical advantage to reduce your tax is that your growth/earnings on the investment is exempt from tax when you withdraw it.


reduce your tax
Good news. Tax relief is on the way from SARS for non-compliant taxpayers. Picture: File.

This is a well-known way to reduce your tax, says TaxTim. Contributions towards any pension, provident or retirement annuity (RA) are tax deductible up to a limit of 27.5% of the greater of your taxable income (to a maximum of R350 000 per year).

ALSO READ: Putting off your 2023 tax return? Here are 12 reasons why you shouldn’t

Don’t worry if that sounds a little complicated. What you need to know to reduce your tax is if you have excess cash, you can top-up your retirement savings yourself by contributing to a retirement annuity fund. This is over and above the pension and provident fund contributions structured via your employer. The only catch is you cannot access these until you are 55 years of age.


TaxTim says a contribution to a non-profit or Public Benefit Organisation (PBO) has special approval from SARS not to pay any tax. These organisations will most likely be involved in healthcare, education, poverty alleviation, housing, conservation, environmental and cultural studies.

ALSO READ: Unhappy with your tax return? Here’s how you can lodge a COMPLAINT

Contributions to registered PBOs are tax deductible up to a limit of 10% of your taxable income. Click the link to find a list of SARS approved PBOs HERE. Any donations exceeding this limit are carried forward and can be claimed as a deduction in the following tax year. To claim the tax deduction in your ITR12, you must ensure you obtain the correct S18A tax certificate from the PBO.


reduce your tax
Here’s why you should complete a tax return even if you earn less than R500 000. Picture: File.

If you contribute to a Medical Aid throughout the year you receive a fixed monthly tax credit as the primary member and a further credit for every dependent thereafter. SARS calls this the Medical Schemes Fees Tax Credit, it doesn’t take your taxable income into consideration and is a direct way to reduce your tax liability each month.

ALSO READ: 2023 Filing is OPEN: Here are 8 tips to help with your tax return

If you have any questions/suggestions about ways to reduce your tax contribution, leave a comment in the comments section below or you can contact us on our WhatsApp line.

Don’t forget that SARS eFiling runs until 23 October 2023 for individual taxpayers.

This article is for informational purposes only and should not be construed as financial, tax or legal advice. For further details consult the SARS website or get in touch with a tax specialist, like TaxTim.