You’re crushing it with your side hustle — baking rusks for your neighborhood, driving for Bolt on weekends, or designing logos for clients on Fiverr. The extra cash feels great, but here’s the catch: the South African Revenue Service (SARS) doesn’t care if it’s “just pocket money.” If you’re earning income, you’re on their radar. In 2023, SARS collected R2.07 trillion in taxes, and they’re cracking down on undeclared income from gig workers, with 20% more audits targeting small-scale earners (SARS Annual Report, 2023).
The big question: Is your side hustle legal, and are you handling your taxes correctly? Many South Africans dive into side gigs without realizing they could face hefty penalties, interest, or even legal trouble for dodging tax laws. This blog is your no-nonsense guide to staying compliant as a gig worker in South Africa. We’ll break down who needs to register, key tax rules, how to track income, and what to do if you’re behind — so you can hustle confidently without SARS knocking. Think of taxes like loadshedding: ignore them, and you’re in the dark; plan ahead, and you keep the lights on.
Who Counts as a “Gig Worker” or Side Hustler in SA?
A gig worker or side hustler is anyone earning income outside traditional full-time employment. In South Africa, this includes:
- Ride-Hailing Drivers: Uber, Bolt, or inDrive operators.
- Freelancers: Writers, graphic designers, virtual assistants, or social media managers.
- Food & Craft Sellers: Home bakers, kota vendors, or Etsy shop owners.
- Content Creators: YouTubers, TikTokers, OnlyFans creators, or podcasters.
- Informal Traders: Street vendors, event planners, or second-hand clothing resellers.
- Tutors & Coaches: Language teachers, fitness trainers, or career consultants.
SARS doesn’t distinguish between a “hobby” and a business. If money hits your bank account regularly — whether it’s R500 from selling vetkoek or R5,000 from freelancing — it’s taxable income. The key threshold? If your total annual income (job + side hustle) exceeds R95,750 in the 2024/2025 tax year, you’re likely liable for income tax (SARS, 2024). List all your side hustle income sources (e.g., Uber, baking, tutoring). Estimate your annual earnings to see if you’re near the R95,750 threshold.
Key Tax Thresholds & Rules in South Africa (2024/2025)
Understanding tax rules is critical to staying legal. Here’s a breakdown of the 2024/2025 tax year thresholds and obligations, as outlined by SARS and the National Treasury (Budget Speech, 2024):
| Income Category | Threshold | Notes |
| Taxable Income (Under 65) | R95,750/year | Below this, no income tax, but you may still need to file a return. |
| Provisional Taxpayer | Any self-employed income | Declare income twice a year (August and February). |
| VAT Registration | R1 million/year turnover | Mandatory if your hustle earns over R1m; voluntary at R50,000. |
| Foreign Income (e.g., OnlyFans, Upwork) | Any amount | Declare all foreign earnings; subject to personal income tax. |
Additional Rules:
- Personal Income Tax: Applies to all income above R95,750, with rates from 18% (R95,751–R237,100) to 45% (above R1.817m).
- Provisional Tax: If you’re self-employed (e.g., freelancing or selling), you must estimate and pay tax twice yearly. Missing deadlines incurs penalties.
- VAT: If your hustle earns over R1 million annually, register for VAT (15% on sales). You can voluntarily register at R50,000 to claim VAT back on expenses.
- Micro-Businesses: Turnover tax (0–6%) is an option for hustles with turnover below R1 million, simplifying tax for small traders (SARS, 2024).
In 2023, SARS audited 15,000 micro-businesses and freelancers, recovering R1.2 billion in undeclared taxes (Fin24, 2024). Gig workers are no longer flying under the radar. Check your total income (job + hustle) against the R95,750 threshold. Note if you’re self-employed, as you may need to register as a provisional taxpayer.
What Happens If You Don’t Declare?
Ignoring taxes is a risky move. SARS has sophisticated tools, like bank transaction tracking and third-party data from platforms (e.g., Uber, Airbnb), to spot undeclared income. Consequences include:
- Penalties: Up to 200% of unpaid tax (e.g., R10,000 owed could become R30,000).
- Interest: 7% per annum on late payments, compounding monthly.
- Blacklisting: Undeclared income can flag you with credit bureaus, blocking loans, tenders, or mortgages.
- Legal Action: Persistent non-compliance may lead to fines or jail time in extreme cases (SARS Compliance Programme, 2023).
Even small hustles can be audited. If your Capitec or FNB account shows regular deposits (e.g., R2,000/month from baking), but your tax return shows nothing, SARS will notice. In 2024, 30% of audits targeted gig workers earning under R300,000/year (Fin24, 2024).
How to Register & Stay Compliant — Step by Step
Staying legal is easier than you think. Follow these steps to keep SARS happy:
Step 1: Register as a Taxpayer
- How: Sign up on SARS eFiling (free) at www.sarsefiling.co.za. Use your ID, proof of residence (e.g., utility bill), and bank details.
- Who Needs It: Anyone earning income, even below R95,750, should register to file returns (even if it’s R0 tax).
- Time: 10–20 minutes online; approval within 1–3 days.
- Tip: Call SARS (0800 00 7277) or visit a branch if you need help.
Step 2: Track ALL Income
- Why: SARS requires proof of every rand earned, even cash or PayPal payments.
- Tools:
- Free: Google Sheets or Excel to log sales (date, amount, client, payment method).
- Apps: Wave (free), Zoho Books (R149/month), or Sage Accounting (R199/month) for automated tracking.
- Records: Save invoices, WhatsApp payment confirmations, bank statements, and platform reports (e.g., Bolt earnings).
- Example: A baker might log: “10/04/2025, R500, 5 cakes sold, Mrs. Ndlovu, EFT.”
Step 3: Know Your Tax Type
Your hustle determines your tax obligations:
| Hustler Type | Tax Type | Frequency |
| Freelancer (e.g., design) | Provisional Tax | Twice/year (Aug, Feb) |
| Informal Seller (e.g., kota) | Personal Income Tax | Annually (Jul–Sep) |
| YouTube/OnlyFans | Foreign Income + Personal Tax | Annually + proof |
| Uber/Bolt Driver | Personal Tax + VAT (if over R1m) | Quarterly VAT possible |
- Provisional Tax: Estimate your annual income and pay 50% in August, 50% in February. Adjust if earnings change.
- Foreign Income: Declare earnings from platforms like Upwork or OnlyFans in ZAR (use exchange rates). Keep payment proof.
Step 4: Deduct Legit Business Expenses
You can reduce taxable income by claiming expenses, but keep proof (receipts, invoices):
- Ingredients/Materials: Flour, meat, or fabric for your hustle.
- Airtime & Data: Used for client calls or marketing.
- Fuel & Travel: Deliveries or client meetings.
- Equipment: Laptop, phone, or stove (depreciated over time).
- Other: Internet, packaging, or software subscriptions.
Example: A driver earns R120,000 but spends R30,000 on fuel and R5,000 on data. Taxable income drops to R85,000, potentially below the tax threshold.
Action: Register on eFiling if you haven’t. Start a Google Sheet to track income and expenses. List 3 deductible expenses for your hustle.
What If You’re Not Registered Yet? Fixing the Backlog
If you’ve been hustling without declaring, don’t panic — but act fast. SARS offers a Voluntary Disclosure Programme (VDP) to come clean:
- What: Declare past income honestly to avoid penalties and interest (up to 200% of tax owed).
- How: Apply via eFiling or a tax practitioner. Submit all income records (bank statements, invoices).
- Cost: You’ll pay back taxes owed, but SARS may waive penalties if you’re upfront.
- Stat: In 2023, 8,000 taxpayers used VDP, saving R500 million in penalties (SARS, 2023).
- Recommendation: Hire a registered tax practitioner (R1,000–R5,000) for complex cases. Find one via the South African Institute of Tax Professionals (SAIT).
Bonus: Tools and Resources
Make tax compliance easier with these:
- SARS eFiling: Free platform for registration, filing, and payments (www.sarsefiling.co.za).
- National Treasury Budget Calculator: Estimate your tax liability (www.treasury.gov.za).
- Wave Accounting: Free app for income and expense tracking (www.waveapps.com).
- SARS Tax Guides: Download “Tax for Small Businesses” or “Provisional Tax Guide” from www.sars.gov.za.
- TaxTim: Online tax assistant for SA freelancers (R299–R799/year, www.taxtim.com).
Common Mistakes Side Hustlers Make
Many South African side hustlers stumble into tax trouble by making avoidable mistakes. A common error is assuming cash or small payments, like those via M-Pesa, don’t need to be declared, but SARS tracks bank deposits and platform tips, with 40% of 2023 audits targeting cash-based hustles (Fin24, 2024). Another pitfall is mixing personal and business income in one bank account, such as using the same account for groceries and hustle earnings; opening a separate account, like Capitec Business (R0–R10/month), or using apps like Yoco can keep transactions clear.
Failing to keep receipts or invoices is also a costly mistake, as losing proof of expenses or income can hurt during audits — instead, save digital copies, like WhatsApp screenshots or emails, in a Google Drive folder, as a baker might do for flour receipts and cake sales. Some hustlers skip filing a tax return when their income is below the R95,750 threshold, assuming it’s unnecessary, but registered taxpayers must file even if they owe R0, a mistake that triggered 25% of penalties in 2023 (SARS, 2023). Finally, freelancers often miss provisional tax deadlines in August and February; setting calendar reminders and paying even a small amount, using SARS’s provisional tax calculator (www.sars.gov.za), shows compliance and avoids penalties.
Your side hustle is a powerful way to boost your income, but skipping taxes can land you in trouble. South Africa’s gig economy is thriving, with 1.2 million informal workers driving R150 billion annually (Stats SA, 2023). To stay safe, register with SARS, track every rand you earn, and claim deductions for expenses. Taxes aren’t a burden — they’re part of building a legit business. Get started with eFiling and a simple income log to keep things smooth. With these steps, you can grow your hustle confidently and keep it legal.
