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Mineral and Petroleum Resource Royalty

Introduction

Mineral Petroleum and Resources Royalty (MPRR) is triggered on the transfer of minerals extracted from within the Republic. As is the case for all other taxes, duties, levies, fees or money collected by SARS, the Royalty collected is paid to the National Revenue Fund. This Royalty became effective from March 2010.

In the past, mineral and petroleum resources were privately owned, meaning that payment for the extraction of these resources was payable to the State only under certain circumstances, e.g. where mining had been conducted on State-owned land.

To bring South Africa in line with prevailing international norms, the Department of Minerals and Energy promulgated the Mineral and Petroleum Resources Development Act, 2002 (MPRDA) in terms of which these resources are recognised as the common heritage of all the people of South Africa with the State as custodian, for the benefit of all South Africans. The Minister promulgated the Mineral and Petroleum Resources Royalty Act, 2008 as well as the Mineral and Petroleum Resources Royalty (Administration) Act, 2008 to give effect to the requirement in the MPRDA that a royalty be levied on the extraction of a mineral resource. Both Acts are administered by SARS.

Current focus

SARS is implementing a new platform for the administration of the Mineral and Petroleum Resources Royalties (MPRR). This is in support of SARS’ objective to make it easy and simple for taxpayers to meet their tax obligations.

Transactions (historic and current returns, payments, and refunds) are being uploaded onto the new system. This data take-on process commenced in September 2021 and is occurring in batches. SARS will communicate when your data is taken-on.

What is required from the taxpayer in preparation for the MPRR data load?

  1. Ensure that the entity is registered as a MPRR taxpayer with SARS. If the entity is not yet registered for MPRR but already registered for any another tax type and has an existing eFiling profile, the registered representative can initiate a MPRR registration by using the Registration, Amendments and Verification (RAV01) online form on eFiling;
  2. If the entity is already registered for MPRR but does not have an existing eFiling Profile, the registered representative can create an eFiling account/profile;
  3. Verify the entity bank account details on eFiling and ensure it matches with those specified in the RAV01 online form, specifically for MPRR;
  4. Ensure the entity does not have more than one active Income Tax reference number;
  5. All MPRR taxpayers must have a registered and active representative, often the Public Officer of a company;
  6. Ensure all outstanding MPRR returns, since the entity’s registered date of liability to date, are submitted to SARS via the mineral royalty mailbox ([email protected]).

The data load for your entity will only be scheduled if your return submissions are up to date. Once the data load is performed, the monthly MPRR Statement of Account will reflect the take-on transactions.

  1. All taxpayers registered for MPRR should already have received a monthly MPRR statement of account. The first statement was issued on 1 August 2021 and was sent to the email address reflected in your registered particulars.
  2. Statements are being issued at the end of each month.
  3. The statement should only reflect transactional data if your data was already taken-on to the new system, or where taxpayers participated in payment testing with SARS. The statement will only reflect all returns and payments once you have been fully taken on to the system.

Refer to the MPRR FAQs further down for more information.

What’s new?

  • July 2022 – Deregistration

To deregister an entity for MPRR, please ensure that you have submitted all outstanding MPR3 returns, then submit a request to be deregistered through the MPRR email address ([email protected]). When requesting a deregistration from SARS kindly ensure that all outstanding returns have been submitted and outstanding taxes was paid. A deregistration cannot be finalised if your tax records are not up to date.

Refer to these MPRR FAQs:

MPRR taxpayers that qualify for the Small Business exemption are not answering “yes” to question 4 on the MPR3 return. As a result the Return does not take the exemption into account, resulting in MPRR taxpayers making an MPRR payment when it is not required.

If you qualify for the Small Business exemption, kindly answer “yes” to question 4 on the Annual MPR03 return and attach your Annual Financial Statements as well as the detailed MPRR calculation.

Who should register for MPRR?

The following person/entity must register for MPRR:

  • Any person/entity that holds a prospecting right, retention permit, exploration right, mining right, mining permit or production right or a lease or sublease in respect of such a right; or
  • Any person/entity who wins or recovers a mineral resource extracted from within the Republic.

What steps must I take?

The below steps will assist taxpayers to register for MPRR, activate the eFiling profile and update master data. 

Step 1 – Ensure the entity is registered with SARS as a taxpayer:

To register with SARS for the first time and you do not have a tax number, you must do an entity registration at a SARS branch.

Step 2 – Ensure the entity is registered for MPRR as a tax type:

The entity will be able to subscribe to MPRR on eFiling through completion of the Registration, Amendments and Verification (RAV01) online form’s MPRR section on eFiling, or by visiting any SARS Large Business Centre.

  1. The MPRR registration option is under the “Maintain SARS Registered Details” Menu Option;
  2. Once the MPRR registration container in the RAV01 online form is completed and submitted, a Notice of Registration will be issued to the eFiler’s correspondence page;
  3. Every registrant will be issued with an “814XXXXXXX” MPRR account number.

Step 3 – Ensure the entity has a Registered Representative:

All MPRR taxpayers must have a registered representative. A registered representative is a person who is appointed with full rights to act on behalf of another legal entity (e.g. Companies, Trusts, etc.), often Public Officers, Accounting Officers, or administrators, etc. If a legal entity has more than one registered representative, then one must be nominated as the official “representative person” and registered with SARS. Please ensure the details are updated and correct to prevent any delays.

  1. The Registered Representative information are captured during the MPRR registration or can be added through the new ‘Send us a query’ functionality from this website if it was not previously provided.
  2. Use the following link on the ‘Send us a query’ functionality: Update the Registered Representative.

Step 4 – Activate the eFiling profile:

If you are not yet registered as an eFiling user, follow the steps to register as a new user on eFiling.

Step 5 – Ensure the MPRR services (profile) have been activated:

After you have been registered as an MPRR taxpayer and appointed the registered representative, the MPRR services can be activated in the registered representative eFiling Profile which will allow the registered representative or the Tax Practitioner to perform MPRR actions, such as file and pay.

  1. Logon to eFiling to activate your MPRR profile on the eFiling account/ profile.
  2. You can view the Tax Types linked to the entity on the eFiling account/ profile under the “Manage Tax Type” menu option of the eFiler’s profile. If the MPRR tax type is not yet activated, follow the next steps:
    1. Select Organisations from the top menu bar.
    2. Select SARS Registered Details (left menu bar).
    3. Select Activate Registered Representative and follow the instructions. Where MPRR is one of the tax products registered, eFiling displays the MPRR tax type option to make it available for activation;
    4. The Button to “Activate” the tax type will only be made available if the taxpayer record is linked to a Registered Representative (RR) on SARS database, else a “Not available” status is displayed;
    5. Where the user accessing the record on eFiling is the Registered Representative (RR) for the taxpayer, the Tax Type will automatically be activated once the user selects the “Activate” button;
    6. If the user is not the current Registered Representative (RR) but the taxpayer record has a linked Registered Representative, then the request to activate will be sent to the current Registered Representative for approval.

Step 6 – Ensure the MPRR bank account details have been verified:

Verify your bank account details on eFiling and ensure it matches with those specified in the RAV01 online form, specifically for MPRR.

  1. Verify the bank account details by selecting “Organisation (left menu bar) -> Change Details”.

Step 7 – Update master data details, especially your email address:

If you are registered for MPRR, with an active MPRR eFiling profile, you can update your registered particulars for MPRR, as well as your email address, via SARS eFiling using the RAV01 registration form on eFiling.

All taxpayers registered for MPRR should already have received a monthly MPRR statement of account. The first statement was issued on 1 August 2021 and was sent to the email address reflected in your registered particulars. If you have not received the SoA, ensure that the eFiling profile is activated.

Step 8 – I am still experiencing issues, who do I contact?

MPR3 – Return submissions

 The MPR3 form has been standardised to cater for all the attributes namely filing, payment and return obligations below: 

Section of MPR03 Return​

Filing ​Obligation

Payment​ Obligation

First Estimate​

​First Estimate return must be submitted on or before the end of six (6) months, on or after the start of the year of assessment.

​First payment – 50% of estimated total liability for the year of assessment – payment is due six (6) months on or after start of tax year-end.

Second Estimate ​

​Second Estimate return must be submitted on or before the end of the year of assessment.

​Second payment – balance of estimated total liability for the year of assessment – payment is due on or before tax year-end.

Return of Excess

​An optional third top-up return, referred to as the “Return of Excess”, can be used to declare additional liability for the year of assessment, that was not catered for in the first and second estimate returns. To be submitted on or before the end of six (6) months after the end of the year of assessment.

​Optional Top-up Third Payment – Amounts not catered for in first and second estimate for the year of assessment is due on or before six (6) months after the end of the year of assessment.

Annual Declaration

​An annual return must be submitted twelve (12) months after the end of the year of assessment for final reconciliation purposes.

​Final liability settlement – last top-up payment is due six (6) months after the end of the year of assessment. Any payments relating to the particular tax year after this date will attract additional interest.

Please ensure that you download the latest MPR3 return from the website when completing your return to ensure that you are working on the latest version.

If your MPR3 return submissions are up to date, you will be scheduled for data take-on. SARS will advise you when your data is uploaded onto the MPRR system.

Outstanding returns and updates to the MPRR date of liability can be sent to ([email protected]).

When and how should MPRR be paid?

Payments can only be made via the eFiling channel using the “Additional payment” option linked to the “MINR” (Mineral Royalty) tax type. Note that payments at the bank, including EFTs, were discontinued for MPRR payments on 13 September 2019. This implies that MPRR is only payable by using the eFiling channel. Refer to eFiling Payments (Credit Push) for more information and guidance on the utilisation of the eFiling payment platform.

CRITICAL: An eFiling profile must be set up for each MPRR taxpayer, and all payments must be made via this channel. Click here for the MPRR FAQ with steps on the creation of the eFiling profile.

Note that each payment must be accompanied by a completed MPR3 return as required by legislation. This is applicable for the 1st and 2nd provisional payments, the 3rd excess payment (if a further payment is necessary) and any final payment/s.

Interpreting your monthly MPRR statement of account

The container “Compliance Information” on your statement provides a list of all the tax periods that you are liable for, as determined by your MPRR liability date. This compliance information will be updated systematically as data loading progresses.

To determine which MPR3 returns are due, consider the following:

  • For a taxpayer with a year of assessment ending December 2018, the First Provisional Return, the Second Provisional Return and the Annual Final Return are required to be submitted for the 2018 year onwards. If a top-up payment was processed, the Return of Excess must also be submitted.
  • For a taxpayer with a year of assessment ending in any other month (not December 2018), the First Provisional Return, the Second Provisional Return and the Annual Final Return are required to be submitted for the 2019 year onwards. If a top-up payment was processed, the Return of Excess must also be submitted.
    • For all prior years (in both above scenarios) the Annual MPR3 return must be submitted (even if the return is Nil) for each year, since the MPRR liability date.

In the absence of these returns, the system will automatically treat the account as non-compliant.

You are therefore required to check that the listing of tax periods is correct, that you have provided all your returns for each of the indicated tax periods and have taken the following actions:

  1. If the tax periods indicated in the container “Compliance Information” on your statement (i.e. outstanding returns) do not coincide with your MPRR date of liability, please provide the necessary supporting documents for us to update your date of liability. Detail of where this can be provided is set out in paragraph 2 below.
  2. If you know that you have not provided all your MPR3 returns for the indicated tax periods/ have been specifically requested to submit outstanding MPR3 returns, please submit these MPR3 returns via the mineral royalty mailbox ([email protected]) urgently.

What can we expect from future MPRR improvements?

As soon as the MPRR data take-on is concluded, MPRR registrants can expect the following process and system enhancements:

  1. An enhanced eFiling payment process will be activated that is specific to MPRR. This new payment process will replace the current eFiling “ad hoc” payment process. Registrants must have activated MPRR on their eFiling profile in order to use this function. Registrants are therefore encouraged to activate their eFiling profiles as soon as possible.
  2. Ability to file MPRR Returns via the eFiling channel.
  3. eAccount functionality on SARS eFiling that will enable you to administer and maintain your MPRR account (allocation of payments, request interim statements, request refunds, etc.).

The abovementioned release dates will be communicated to taxpayers.

Important links

You can access the MPRR external guide and MPR3 form below:

To access this page in different languages click on the links below:

Related Documents

GEN-GEN-01-G01 – Guide for Completion for Minerals and Petroleum Resources Royalty – External Guide

LAPD-IT-G19 – Comprehensive Guide to Dividends Tax

LAPD-IT-G24 – Guide on Mutual Agreement Procedures

Legal-Pub-Guide-Gen01 – Taxation in South Africa

Legal-Pub-Guide-Gen02 – Guide for Tax Rates Duties Levies

MPR1 – Mineral and Petroleum Resources Royalty Application Form – External Form

MPR3 -Return of Royalty – External form 1

Frequently Asked Questions

Table of Contents

Last Updated:

  • 09/04/2024
  • 16:04
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