New SARS Regulations to consider when donating to PBO’s

by Daniël Malan and Herschelle Haywood | April 23, 2024

Donating to Public Benefit Organizations (PBOs) can lead to tax deductions for both companies and individuals, provided they hold a valid tax certificate from a qualifying PBO. However, recent changes in requirements by the South African Revenue Service (SARS) will affect both PBOs and their donors, with the latest adjustments taking effect from 31 May 2024.

It’s crucial for potential donors to verify the eligibility of the PBO and its tax certificate with SARS to ensure compliance with the new requirements before making donations. Professional assistance is recommended for PBOs to navigate these changes effectively.

The new requirements aim to streamline the process of making deductions available to qualifying donor taxpayers while also preventing abuse of Section 18A claims, according to SARS.

PBOs, that engage in various public benefit activities such as religious institutions, day care centers, disaster relief organizations, and health clinics, rely heavily on donations. To incentivize public generosity, taxpayers can claim tax deductions for certain donations made to qualifying PBOs.

Qualified PBOs, known as Section 18A-approved organizations, issue tax certificates, also called Section 18A receipts, to donors. These certificates enable individuals or companies to deduct donations in cash or property from their taxable income.

Previously, PBOs were required to provide limited information for a valid Section 18A certificate, including details of the PBO, donation date, amount or nature, purpose of the donation, and donor’s name and address. However, additional requirements have been introduced, necessitating more detailed donor information such as identification or registration numbers, trading names, income tax reference numbers, and contact details.

Furthermore, PBOs are now mandated to submit bi-annual reports, referred to as IT3(d) reports, to SARS. The first deadline for PBOs to comply with this requirement is 31 May 2024. These reports should include data on Section 18A tax-deductible receipts issued during the 2023/2024 assessment year, submitted via efiling.

Given these changes, it’s more important than ever for companies and individuals to ensure that both the PBO they support and the tax certificate they receive meet SARS’ new requirements to qualify for tax deductions. Additionally, donors should be aware that tax-deductible donations are subject to a limit of 10% of taxable income.

Professional assistance can help PBOs navigate these new requirements and deadlines, ensuring compliance and enabling donors to enjoy the tax breaks designed to encourage charitable giving.

For further guidance and assistance contact Dale Petersen on 021 819 7802 or at to connect with us.


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