Tax Exempt Institutions Connects Issue 12 (August 2026)
This issue covers key information that entities applying for Income Tax Exemption should be aware of. This includes selecting the correct “Nature of Entity” when registering for Income Tax, as well as selecting the correct Exempt Institution category when applying for Income Tax exemption. We also recap the requirements for Section 18A tax-deductible receipts and the submission of IT3(d) third-party data to SARS.
- Qualifying Nature of Entity Types for Income Tax Exemption
- Exempt Institution Categories
- Section 18A and IT3(d) Third-Party Data
- Requesting an Approval Letter Copy
Qualifying “Nature of Entity” Types for Income Tax Exemption
Please select the correct “Nature of Entity” when registering for Income Tax. The “Nature of Entity” is determined by the “Founding Document” of the entity. The information below provides guidance on the founding document per “Nature of Entity” type.
If the entity selects the incorrect, or non-qualifying, Nature of Entity when registering for Income Tax, the entity must book an appointment to visit the closest SARS Taxpayer Service Centre to amend the “Nature of Entity”.
Please note: “Association not for Gain” or “Welfare Organisation” must not be selected. If existing approved Exempt Institutions are registered as these designations, the Nature of Entity must first be updated to “Association of Persons (Voluntary Association)” at a SARS branch before they can apply for exemption, Section 18A status, or update exemption details.
Existing Exempt Institutions must please rectify the Nature of Entity — if it is registered as either an “Association not for Gain” or “Welfare Organisation” — to “Association of Persons (Voluntary Association)”.
For more information, visit Tax Exempt Institutions.
Exempt Institution Categories
There are different Exempt Institution categories. It is important to choose the correct category when applying for Income Tax Exemption.
SARS considers the application based on the Exempt Institution Category selected at point of application and must finalise the application on this basis. The incorrect category selection will result in SARS declining the application. The entity may submit a new application with the correct category selected.
Please visit the Tax Exempt Institutions for more information on the Exempt Institution categories.
Beware of Scams
SARS will never request passwords, one-time pins (OTPs), banking PINs, or eFiling login credentials through email, SMS, social media, or telephone. Taxpayers must use only official SARS channels and verify the credentials of any tax practitioner before sharing personal information.
See examples here of the latest SARS Scams. If in doubt, please email [email protected].
Section 18A and IT3(d) Third-Party Data
On 24 October 2025, Public Notice 6762 was published, which came into effect from 1 March 2026. This Public Notice stipulates the required additional mandatory information to be submitted (these inclusions are the income tax reference number, and information relating to the donation of property made in kind).
All approved Section 18A entities must submit IT3(d) third-party data for all Section 18A tax-deductible receipts issued to donor taxpayers.
Important Information
- An IT3(d) submission is complete only once the IT3-02 Return (Declaration) has been submitted to SARS via eFiling.
- If an approved Section 18A entity did not issue tax-deductible receipts during the submission periods, the entity must still submit a “NULL DECLARATION” to SARS.
- Always capture the Section 18A information (total receipts and total value) in the IT12EI annual return.
- Non-submission of IT3(d) third-party data can prevent the donor taxpayers from claiming valid Section 18A tax-deductible receipts.
- The submission of IT3(d) is a requirement to maintain the entity’s Section 18 exemption status.
Educational videos
SARS has created educational videos on SARS TV to assist taxpayers.
