Tax on interest question

[TheLoneWolf]

Hi all,

Just a quick tax question.

I have a very small business and I have been paying myself a salary of R5000.00 per month. However, I also earn interest on savings from my bank which amounts to about R1000 per month. What I have read is that interest earned under R23800 per year is exempt from tax.

So I just want to make sure that I understand it correctly, will the interest I earn (R12000 per year) be counted towards the personal income tax threshold of R75750 per year? Will SARS combine my business income with my interest income and say I owe them money?

Many thanks.

 

[AchmatK]

Only the amount above the interest exemption will be added to your taxable income.

You still need to declare all interest earned though.

 

[silkenphoenixx]

Only the amount above the interest exemption will be added to your taxable income.

You still need to declare all interest earned though.

Correct. The bank will give you a certificate in around July every year when the tax returns become due.