I want to get a tax directive

What's New?

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  • 22 June 2020 - Tax Directives Go-Live date:
    SARS introduced enhancements to the Tax Directives system on 19 June 2020, as per the  Interface Specification IBIR-006 Tax Directives version 6.005. The high level overview of the changes that have been introduced are in respect of the Foreign Tax Credit (IRP3q) - Par 10 of the 4th Schedule and Provision for Doubtful Debtors (IRP3f) - Section 11(j)I of the Income Tax Act.

    These changes enable stakeholders to:
    • Submit applications electronically
    • Attach supporting documents electronically
    • Send an electronic directive to the applicant.

For any queries, you may call the SARS Contact Centre on 0800 00 7277.

12 June 2020 - ISV Platform:
ISVs please note the changes stated in the IBR006 version 6.005 specification will go-live on 19 June 2020.   In preparation for the go-live the test environment will not be available from Monday, 15 June 2020 until Wednesday, 17 June 2020.  No Directive files should be submitted after 15:00 on 19 June 2020.

  • 12 June 2020 - eFiling Clients:
    All Clients to be informed that the changes stated in the Directives Business Specifications IBR006 version 6.005 will go-live on 19 June 2020.  

  • 15 May 2020 - Go-live date to be communicated

    Please note that SARS will communicate the go-live date for the changes stated in the IBR006 version 6.005 specification in early June 2020.  You are reminded and encouraged to participate in the Trade Testing from 18 May 2020 that you were invited to in the notification published on 2 April 2020.

  • 11 May 2020 - Living Annuity Commutation

    The current minimum values of annuity or part of the retirement interest which an individual can commute is the amount of R50 000, in the event that there was a previous lump sum commutation in the fund or R75 000 in any other case. These values have now been replaced with a single threshold of R125 000. The system has been updated to allow the member to commute the living annuity where the value is equal to or less than the new de-minimus amount of R125 000 for the directive reason ‘Par. (c) Living Annuity Commutation’.

  • 5 May 2020 - The updated Interface Specification IBIR-006 Tax Directives version 6.005 was published.

  • 22 April 2020 - Tax Directives has been a separate service on eFiling whereby the Pension / Provident Fund Administrator or Employer with an eFiling Organisation website profile completes different forms to apply for a tax calculation on a lump sum payable to clients on retirement or resignation.  The latest enhancement will allow Tax Practitioners and Individuals to electronically apply for IRP3(b) and IRP3(c) Tax Directives through their efiling profiles rather than having to resort to going into a SARS Branch Office for a manual application which is performed directly on ITS. In other words, Individual Taxpayers and Tax Practitioners can now submit the IRP3(b) and IRP3(c) application form through eFiling. IRP3(b) and IRP3(c) hardcopy applications will no longer be processed.

What is the purpose of a tax directive for lump sums?

The purpose of a tax directive is to enable SARS to instruct an Employer, Fund Administrator or Insurer how to deduct employees' tax from certain lump sums to a taxpayer or member. 

Employers, Fund Administrators and Insurers can request a tax directive from SARS via the following channels:
  • eFiling – Employers and Fund Administrators who have an organisation profile can log in and request a directive online.
  • Register as an Interface agent. (Refer to the Tax Directive Interface specification)
  • Use one of the email addresses.

Tax calculations according to the tax directive should be regarded merely as an estimate according to the information on SARS tax directive system. Some employees may find that they still have to pay in substantial amounts or that a credit may be due to them once the final liability has been determined on assessment in accordance with the date of accrual.

Application forms are available for specific tax directive types. Form A&D, Form B, Form C and Form E serve as examples of the form layout.

The Employer / Fund Administrator / Insurer must ensure that the correct application form is used according to the reason for the exit from the fund / employer’s service and the nature of the amount payable to the employee / member of the fund.

What is the purpose of a hardship directive?

A taxpayer can submit a directive application requesting SARS to consider alleviating hardship due to circumstances outside the control of the taxpayer. The taxpayer must assure SARS that the situation is outside his / her control and has caused financial hardship.  Cases will be reviewed on an individual basis to determine whether the taxpayer qualifies for a hardship directive under these circumstances. The taxpayer or the taxpayer’s tax practitioner can complete the IRP3(b) or the IRP3(c) application form and submit the application form through SARS eFiling only.

Here is a complete list of applications forms available:

  • IRP 3(a) – Gratuities paid by employer (e.g. death / retirement / retirement due to ill health / retrenchment / other – to supply reason for payment).
  • IRP 3(b) – Employees' tax to be deducted at a fixed percentage (e.g. commission agents / personal service company / personal service trust).
  • IRP 3(c) – Employees' tax to be deducted at a fixed amount (e.g. Paragraph 11 of the 4th Schedule (hardship) / assessed loss carried forward).
  • IRP 3(d) – Decommissioned.
  • IRP 3(s) - Employees' tax to be deducted on any amount to be included under section 8A or 8C of the Income Tax Act.
  • Form A&D – Lump sums paid by pension, pension preservation fund, provident or provident preservation fund. (e.g. death before retirement / retirement due to ill health / retirement / provident fund – deemed retirement).
  • Form B – Lump sums paid by pension or provident fund (e.g. resignation / withdrawal / winding up / transfer / Section 1, Paragraph (eA) of the definition of gross income transfer or payment / future surplus / unclaimed benefit / divorce – transfer, divorce – non-member spouse / divorce – member spouse / housing loan / involuntary termination of employment (retrenchment) including withdrawals from a pension preservation or provident preservation fund).
  • Form C – Lump sums paid by a RAF to a member (e.g. death before retirement / retirement due to ill health / retirement / transfer from one RAF to another / discontinued contributions / future surplus / divorce – transfer, divorce – non-member spouse / divorce – member spouse / emigration withdrawal / visa expiry).
  • Form E – Lump sums paid after retirement by an insurer or a fund (e.g. Death Member / Former Member after Retirement, Par. (c) Living Annuity Commutation, Death - Next Generation Annuitant, Next Generation Annuitant Commutation and Transfer of an annuity to another insurer).
  • ROT01 – Recognition of transfer between two funds before retirement must be used where a benefit was transferred to another approved fund.
  • ROT02 – Recognition of GN18 purchase of a member / beneficiary owned pension / annuity from an insurer must be used to acknowledge the purchase of annuities.

Employers, Fund Administrators or Insurers can submit the application forms electronically via an interface agent or register as an agent on SARS eFiling.  Only in exceptional cases where the tax directive application form cannot be processed successfully through any of the electronic platforms can the hard copy tax directive application form be emailed to only one of the email addresses on the SARS website. IRP3(b) and IRP3(c) hard copy applications will no longer be submitted through email.

Minimum information required on the application form:

To avoid a delay in the issuing of a directive, the following crucial minimum information is required on all the tax directive application forms:

  • Tax year;
  • Personal detail of the employee / member of the fund, such as:
    • Surname and full names;
    • Date of birth and ID number or other unique number (e.g. passport number, work permit number or non-resident identity number);
    • Annual income (e.g. annual equivalent of current tax year’s income or the total remuneration for the last 12 months);
    • Physical address and postal code; and
    • Postal address and postal code;
  • Income tax reference number [if the income tax reference number was not entered, the reason for non-registration (e.g. unemployed) must be supplied];
  • Name of employer, fund or insurer;
  • Postal address and postal code of employer / fund / insurer; and
  • Reason for directive (the relevant reason must be marked on the application form). 

For more detailed information required on the Form A & D / B / C / E application forms:

Minimum information required on the IRP 3(a) / (b) / (c) / (s) application forms:

  • The PAYE number of the employer;
  • Date of accrual; and
  • Gross amount of lump sum payment or Gross value of gain / amount.

The relevant income and expense statement and / or other relevant documentation must accompany the application form if the IRP 3(b) or IRP 3(c) application forms are submitted. Please make sure that you use the latest version of the relevant form.

Refer to the Guide to Completion Guide for IRP3(a) and IRP3(s) Form for more detailed information required per application form.

Top Tips:

  • A tax directive is only valid for the tax year or period stated therein.
  • Employers may decline to accept photocopies of directives.
  • Employers may under no circumstances deviate from the instructions of the directive.
  • Tax directives issued to electronic clients via the SARS Interface are valid directives.
  • Employers must apply the percentage of employees' tax as indicated in the directive prior to taking into account allowable deductions for employees' tax purposes (e.g. pension, retirement annuity fund contributions, etc.). Where the employer received a directive and the employee’s commission income is not more than 50% of the gross remuneration income the employer can ignore the directive instruction.
  • From an eFiling perspective, Tax Directive applications submitted before 1 July 2017 can be viewed, cancelled and printed under ‘Tax Directives –prior to 2017’ in the left hand menu on eFiling.
  • Electronic confirmation of receipt: From July 2017 the receiving fund of the transferred benefit or the Insurer where the annuity was purchased must electronically confirm the receipt of the transferred benefit or benefit transferred to purchase an annuity.  If the receiving fund cannot submit the Part B of the ROT electronically, the transferring fund is responsible to submit the manual comprehensive ROT (Part A and Part B) to SARS. 

To see info for Independent Software Vendors (ISV's) or Interface agents, click here.


Last Updated: 21/07/2020 10:34 AM     print this page
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 Top FAQs

Who should request a tax directive?
Form A&D, Form B, Form C and Form E can only be completed by the fund administrator or insurer. IRP3(a) must be completed by the employer.

What relevant material is required to request for a tax directive?
For Emigration withdrawal the Retirement Annuity Fund administrator must complete a manual Form C and the following documents must be attached to the Form C and submitted to a SARS Branch Office for consideration

Why is it necessary to request a directive application?
Fund administrators / insurers and employers are required in terms of paragraph 9(3) of the Fourth Schedule to the Income Tax Act to apply for a directive for any lump sum payable.

How long is a tax directive valid for?
A tax directive is only valid for the tax year or period stated on the directive.

How do I calculate the tax-free portion of a lump sum received or accrued on or after 1 October 2007 on retirement?
With effect 1 October 2007, Formula A was repealed. The definition of formula B has been amended and the symbols in Formula B (Z=C+E-D) represent the following: