Application for Income Tax Exemption

Requirements

An entity wanting to apply for Income Tax exemption must first register for Income Tax and create an eFiling profile.

Once an entity has been registered for Income Tax, they can apply for Income Tax exemption using their Income Tax Reference Number.

The requestor must be the Registered Representative or a Power of Attorney providing a once‑off mandate (with a certified and legible copy of the requester’s certified identification document)

The following must be completed to enable an entity to apply for Income Tax Exemption:

Appointed a Registered Representative
An Income Tax Reference number
Created an eFiling profile
Completed all supporting documents.
Verified Bank account details in the name of the entity.

How to Apply for Income Tax Exemption

The entity that has an active Income Tax registration number, updated SARS Registered Details (including Registered Representative) and an active eFiling profile the taxpayer can apply via eFiling for Income Tax Exemption.

Alternatively, the taxpayer can make an eBooking on the SARS website to visit its closest SARS branch to apply for Income Tax Exemption. The entity must have an active Income Tax registration number, updated SARS Registered Details (including Registered Representative).

Income Tax Exempt Categories

EI Category	Description	Section of the Act
Institution, board or body	Includes the SETA’s, SEDA, Universities, Technikons, Public Schools, Bargaining Councils, etc.	10(1)(cA)(i)
Private company owned by Institution, board or body	Includes entities such as the Land Bank Insurance Company and the University Sports Company, etc.	10(1)(cA)(ii)
Public Benefit Organisations (“PBOs”)	Non-Profit Organisations – welfare, religion, education (incl. independent schools), environmental, early childhood development, cultural, etc.	10(1)(cN) read with Section 30
Recreational Clubs	Amateur Sporting Clubs, Social & Recreational Clubs and Hobby Clubs.	10(1)(cO) rea with Section 30A
Small Business funding entities	Organisations that provide funding to small, medium and micro-sized enterprises	10(1)(cQ) read with Section 30C
Membership Associations	Based on membership to pursue a common interest – includes Mutual Loan Associations, Trade Unions	10(1)(d)(iii) read with Section 30B
Professional Bodies	Based on membership to pursue a common interest – includes the RCBs, Chambers of Commerce	10(1)(d)(iv)(bb) read with Section 30B
Levy Membership Association (Home Owners Associations)	Note that this exemption does not include body corporates	10(1)(e)(i)(cc)

Section 18A Categories

Below is a list of all the Section 18A categories that a taxpayer may apply for.

Section 18A Category	Description	Section of the Act
PBO with S18A (“doer”)	Public benefit organisation approved under section 30 carrying on one or more public benefit activity listed in Part II of the Ninth Schedule	18A(1)(a)(i)
Institution, board or body	Institution, board or body exempt under section 10(1)(cA)(i) carrying on one or more public benefit activity listed in Part II of the Ninth Schedule	18A(1)(a)(ii)
PBO (“funder” / “conduit”)	PBO approved under section 30 providing funds or assets to any public benefit organisation approved under section 18A(1)(a)(i), any institution, board or body approved under section 18A(1)(a)(ii), or any department of government in the Republic in the national, provincial or local sphere approved under section 18A(1)(c)	18A(1)(b)
“Ring-fenced”	PBOs that perform both public benefit activities that are contained in both Part I and Part II of the Ninth Schedule
United Nations Entity	OUnited Nation Entity carrying on in South Africa any public benefit activity listed in Part II of the Ninth Schedule	18A(1)(bA)
Government of the Republic (National, Provincial or Local Sphere)	Any department of government of the Republic in the national, provincial, or local sphere contemplated in section 10(1)(a) which will use donations for purpose of any public benefit activity listed in Part II of the Ninth Schedule	18A(1)(c)

Supporting Documents

Below is a generic list of supporting documents required when a taxpayer applies for Income Tax Exemption. SARS may request additional supporting documents dependent on the Public Benefit Activities the taxpayer performs.

Supporting Documents	Description
Founding Document	NPC – Memorandum of Incorporation (COR 14.1) Trust – Trust Instrument Voluntary Association (Association of Persons) – Constitution (signed and dated) Institution, board or body – Copy of Founding Act (Government Gazette)
Proof of Registration (where applicable)	Registration with CIPC (NPC) or Master of the High Court (Trust) or DSD (NPO Registration) and other
Proof of Bank Account	Stamped Bank confirmation letter or statements (including e-stamped)
Certified ID Copies	Certified ID copies or Passport of the directors (NPC) or trustees (Trust) or Office Bearers (Voluntary Association)
Proof of Physical Address (Entity)	Municipal Account, or CRA01 Form (Confirmation of Residential or Business Address) Bank statement can also be used
Proof of Physical Address (Registered Representative)	Municipal Account, or CRA01 Form (Confirmation of Residential or Business Address) If the RR is not a registered taxpayer
Financial Statements (where applicable)	Entity to provide financial statements if in operation for 12 months (1 year) or more. If Retrospective approval is selected FS for each year must be submitted

Disputes

A taxpayer who is aggrieved by the outcome of the application may lodge a dispute. To dispute the outcome of the assessment or decision, a specific process must be followed within 80 business days from the date of the assessment.

As a taxpayer you have the right to lodge an appeal where your objection has been disallowed in full or in part. The appeal must be lodged on the prescribed form within 30 business days from the date the objection was disallowed or partially allowed. See more information on which form to use and how to submit an appeal.

To read about Dispute related matter, please click here.