Today’s 2026 National Budget Speech delivered by Finance Minister Enoch Godongwana includes excellent news for South Africa’s micro businesses. The Turnover Tax regime has received its biggest overhaul in years – with a huge jump in the brackets and a massive increase in the qualifying turnover limit.
The compulsory qualifying turnover threshold jumps from R1 million to R2.3 million per year, and the tax-free band almost doubles from R335 000 to R600 000. This is the first substantial adjustment since the regime was introduced, finally giving micro businesses room to grow without immediately being pushed into full income tax compliance.
Straight from the Budget
Minister Godongwana highlighted government’s commitment to supporting small and micro enterprises – the real engine of job creation. The new thresholds, together with the simultaneous increase in the VAT registration threshold (also to R2.3 million), form a powerful package of relief for entrepreneurs.
Old vs New Turnover Tax Regime (key highlights)
Micro Business Turnover Tax Comparison
What this means for your micro business
Zero turnover tax on the first R600 000 of turnover – almost double the previous tax-free amount.
Less time on complex tax returns and more time on growing your team and serving customers.
Better cash flow in the critical early and growth stages.
Perfect synergy with today’s VAT announcement
With both the Turnover Tax limit and the VAT registration threshold now aligned at R2.3 million, micro and small businesses can grow significantly further before facing additional compliance burdens.
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