SARB MPG Draft White Paper: Tax Implications of Jibar to ZARONIA Transition

Posted 23 April 2026 Written by Acts Online
Category Financial Sector

Brought to you by SA Legal Academy: The South African Reserve Bank’s (SARB) Market Practitioners’ Group (MPG) has published a draft White Paper detailing the tax implications of transitioning from the Johannesburg Interbank Average Rate (Jibar) to the South African Rand Overnight Index Average (ZARONIA).

In terms of the SARB media statement issued on 3 December 2025, the Jibar will be permanently discontinued immediately after its final publication on 31 December 2026. The draft White Paper is intended to assist market participants in evaluating potential tax consequences arising from various methods of transitioning Jibar-linked contracts to ZARONIA. Stakeholders and market participants are invited to submit input on the draft proposals by 21 May 2026.

The transition is supported by the ‘no new Jibar’ initiative, which sets 1 May 2026 as the date by which market participants are expected to cease issuing new financial contracts referencing Jibar, except in clearly defined and limited cases. To support this, the Prudential Authority and the Financial Sector Conduct Authority have jointly issued a communication outlining supervisory expectations for the implementation of this initiative.

Key Transition Milestones and Directives

  • 1 May 2026: Expected cessation of new financial contracts referencing Jibar.
  • 21 May 2026: Deadline for public comments on the MPG tax-related draft White Paper.
  • 31 December 2026: Final publication and permanent discontinuation of Jibar.

The MPG recommendations and the joint communication from the authorities emphasize the need for robust transition plans to mitigate financial and operational risks associated with the move to ZARONIA. Market participants must ensure that any contract amendments or replacements are reviewed for compliance with the Income Tax Act, No. 58 of 1962, particularly regarding the potential realization of gains or losses during the transition process.

What this means for you, your business, or your clients

  • For yourself: You must familiarize yourself with the ZARONIA calculation methodology and the 1 May 2026 deadline to ensure any professional advice regarding interest-rate-linked instruments remains compliant with supervisory expectations.
  • For your business: Your firm must audit all existing Jibar-linked contracts and treasury systems to ensure they can accommodate ZARONIA before the 31 December 2026 discontinuation, while accounting for the tax risks identified in the MPG White Paper.
  • For your clients: Clients should be advised to cease entering into new Jibar-linked obligations by 1 May 2026 and to begin the formal process of amending existing contracts to include robust fallback language or to transition directly to ZARONIA to avoid legal and tax uncertainty.

Originally published at https://legalacademy.co.za/news/read/sarb-input-sought-on-tax-related-jibar-transition-white-paper

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