South Africa’s small businesses have more room to grow before crossing key tax thresholds. From 1 April 2026, the compulsory VAT registration threshold increased from R1 million to R2.3 million in annual taxable supplies, while the voluntary registration threshold rose from R50,000 to R120,000. SARS also increased the qualifying turnover limit for the turnover-tax regime to R2.3 million. SARS confirms the VAT changes, while its turnover-tax guidance sets out the revised regime.

The changes are relevant to owners, marketing teams and sales teams because tax planning depends on reliable information about sales activity. A business that is approaching the new threshold needs a clear view of its pipeline, expected revenue and customer commitments—not only a year-end turnover figure.

What changed for smaller businesses?

SARS says compulsory VAT registration applies when taxable supplies exceed R2.3 million in a rolling 12-month period, or when the business reasonably expects to exceed that amount. The application must generally be made within 21 business days of the threshold being exceeded. Voluntary VAT registration may still be possible above the R120,000 minimum and below the compulsory threshold, subject to the relevant requirements. SARS’s VAT information provides the current registration guidance.

The turnover-tax ceiling has also increased to R2.3 million. For the 2026/27 year of assessment, SARS lists a zero-tax band up to R600,000, followed by graduated rates for higher turnover bands. The regime is designed for qualifying micro-businesses and is calculated on turnover rather than profit. Eligibility and suitability depend on the business’s structure and circumstances, so owners should confirm the position with SARS or a tax practitioner.

The operational lesson: track growth before it becomes urgent

Our analysis is that the threshold increase should not be treated as permission to delay financial administration. It creates a useful planning window, but that window is easier to manage when marketing and sales information is connected to revenue monitoring.

  • Review the pipeline monthly: compare open opportunities and likely close dates with actual taxable supplies.
  • Separate forecast from confirmed sales: an enquiry, quotation and completed sale should not be treated as the same event.
  • Keep customer records consistent: shared lead and contact records reduce duplicate follow-up and make handovers easier to audit.
  • Document important decisions: record why a contact was assigned to a campaign, when consent was obtained and which follow-up was sent.

A shared CRM can support this process by keeping leads, contacts, assignments and follow-up activity together. Timed nurture sequences, open and link tracking, and editable content can also reduce manual handovers between marketing and sales. These tools do not replace accounting records, but they can help teams connect demand generation with the commercial activity that ultimately affects turnover.

Three practical next steps

First, ask the person responsible for finance to confirm which threshold applies to the business and how taxable supplies are being measured. Second, create a monthly review that compares actual turnover with the value of open opportunities. Third, make sure campaign and sales records are structured consistently enough to explain where enquiries came from and what happened next.

For businesses that want to connect lead capture, permission-based email and follow-up in one workspace, review the available workspace plans. Tax advice should come from SARS or a qualified professional; the operational goal is to make the underlying customer and sales information easier to manage.