Please use this identifier to cite or link to this item: https://hdl.handle.net/10321/4263
Title: Factors influencing tax compliance of small and medium-sized enterprises in the Durban area
Authors: Dlamini, Prisca Nondumiso 
Keywords: Small and medium-sized enterprises (SMEs);Tax Compliance;Taxation
Issue Date: 10-Apr-2022
Abstract: 
It is globally recognised that small and medium-sized enterprises (SMEs) play a
significant role in improving a country’s economic growth and creating jobs. It is, therefore,
in the public interest and in the interests of government to support SMEs. The South
African government has recognised and focused on the improvement of SMEs as one of
its strategic objectives. Regardless of the significance of SMEs for the country and region,
there are numerous difficulties that SMEs face. Therefore, this study was conducted to
evaluate factors that influence tax compliance of SMEs in the Durban area, located in
KwaZulu-Natal, South Africa. The gravest and tedious difficulty is guaranteeing tax
compliance. Taxation is an important source of funding for the government's construction
programmes. For many tax authorities, tax compliance is a major concern, and
persuading SMEs to comply with tax provisions, particularly as tax laws are often not
precise, is a challenging task. South African Revenue Services (SARS) estimates a South
African tax gap of R 300 billion per tax year, and also about 40% of local enterprises are
not registered for tax purposes in South Africa.
This study employed a quantitative research approach to obtain data from 146 SMEs
operating in the Durban area. A total of 230 questionnaires were distributed to SMEs
located in Clermont, Morningside, Umgeni, Durban Central and Phoenix, with 157
questionnaires returned. However, only 146 questionnaires were usable. The research
outcome revealed that participants’ level of education impacts tax compliance, and there
is a positive relationship between the tax compliance costs and tax compliance. Attention
was drawn to the impact on non-compliance due to complex tax filing and high tax rates.
Furthermore, the study indicated that the continuous granting of tax amnesties
demotivates compliant taxpayers. The research recommended that the South African
government consider reviewing the tax rates and compliance costs and reduce noncompliance by SMEs by improving tax awareness campaigns.
Description: 
Submitted in fulfillment of the requirement for the degree of Master of Accounting: Taxation, Durban University of Technology, Durban, South Africa, 2021.
URI: https://hdl.handle.net/10321/4263
DOI: https://doi.org/10.51415/10321/4263
Appears in Collections:Theses and dissertations (Accounting and Informatics)

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