Black Tax: Supporting Family Without Sinking Your Own Finances

Supporting family is a value many of us were raised with. It is also a quiet pressure that can drain a salary before the month is half over.

Black tax is not a problem to eliminate. It is a responsibility to plan for, so that giving lasts.

What is black tax?

It is the informal, unwritten responsibility to support parents, siblings and extended family, often because you are the first or the main earner. It can include school fees, groceries, rent, funerals and medical costs.

When does black tax become a problem?

• You borrow to give.
• You cannot save.
• You skip your own essentials.
• You feel resentment or guilt every month-end.
• Requests are open-ended and growing.

When giving puts you in debt, it stops being sustainable, and nobody is helped when you fall behind.

How do you set a limit on black tax? 5 steps

1. Calculate your essentials: rent, food, transport and your own debt payments.
2. Decide your savings amount, even a small one. See emergency fund.
3. What is left is your giving budget.
4. Decide how much of it is for family.
5. Divide it across the people or needs you support.

Here is a hypothetical example.

If requests add up to R4,000, you cannot meet them all. Speaking about it early is kinder than running out at month-end.

How do you talk to family about it?

• Pick a calm moment, not when someone is asking.
• Share the numbers gently. People often do not know what you earn or owe.
• Say what you can do, not only what you cannot.
• Agree on the amount and date. A fixed monthly contribution is easier than random requests.
• Ask for the plan. How will the family cope in the long term?

Giving a set amount on a set date can be easier for everyone than being asked each time.

How can your help go further?

Money that creates stability lasts longer than money that covers recurring gaps. Examples are paying for a short course, helping start a small business, contributing to a burial society or a stokvel, or buying school items in bulk.

What should you not do?

• Do not borrow to give. Loans add interest, and the repayment competes with the support you want to provide. At the legal maximums, a first one-month R1,000 loan costs about R309. See multiple loans.
• Do not guarantee debts for others without understanding the risk.
• Do not hide it from your partner. See money as a couple.

What if you are already stretched?

Talk to creditors and look at a plan. See what to do when you cannot pay your debts. Seek advice from a debt counsellor if needed. The National Credit Regulator lists registered counsellors.

What does a black tax giving plan look like for three requests?

Here is a hypothetical household with R12,000 take-home pay, R2,300 left for family after essentials, savings and debt. Three requests arrive in the same month, adding up to R4,000.

You cannot meet every request in full, and that is not a failure. Telling people what you can do, and when, is kinder than agreeing and then running out. Decide the plan before the requests come, not under pressure at the door.

What can you say when someone asks for money?

Prepared words make no easier. Here are three short scripts.

When you cannot lend: “I can give you R300 this month. I cannot lend more, because I have fixed commitments. I hope that helps.”

When the request keeps coming: “I have a set amount for family each month. Once it is used, I have nothing left. Let us look at what else we can do together.”

When you want to help in another way: “Instead of cash, I can help you write a CV, or pay the school directly.”

Say it calmly, and avoid long explanations. A fixed amount and a date is clearer than a vague “I will try”.

Can a family fund share the black tax load?

Sometimes the answer is to share the weight. A small family fund, held in a bank account that everyone can see, can handle emergencies such as funerals or medical costs.

The fund needs rules: who may request money, how much and when it is repaid, if at all. Write them down, keep records and share the balance. It turns repeated individual requests into a shared plan.

Our guide to stokvels explains how to set one up safely.

What should you never do to keep the peace?

Some ways of giving can cause you serious harm:

• Signing as surety or guarantor for someone else’s loan. If they do not pay, the lender can claim from you. See loan terms.
• Taking a loan in your name so someone else can have the money.
• Handing over your bank card or PIN.
• Hiding the support from your partner, which causes bigger problems later.

If you are asked to do any of these, say no kindly, and offer a different kind of help.

How do you review your black tax giving each year?

Once a year, usually after a raise or when your costs change, look at the plan. A simple rule is to share a fixed part of any raise, for example one-tenth, and keep the rest for your own goals.

Check that your own savings are growing, that no one has been left out and that the family understands. A plan that adjusts as your life changes lasts longer than one that is set once and resented.

What should you remember about black tax?

Giving is a form of love, and it needs limits to last. Black tax works best when it is planned, fixed and shared, not left to the person who earns the most. Look after your own savings first.

A family helped by a stable giver is better off than one that depends on a giver who is drowning.

Frequently asked questions