Financial Planning

Our essential guide to tax season

This 2-minute read answers essential questions about the South African Personal Income Tax Filing Season, stress and confusion not included!

When it comes to personal finances, nothing baffles like submitting a tax return. We have gathered the information you’ll need to submit with as little stress and confusion as possible.

Why submit your tax return?

Submitting your tax return is an important annual duty, demonstrating good citizenship and a commitment to contribute towards society. Failure to submit comes with heavy penalties.

In many instances, having an unbroken and up-to-date filing record is important. For example, if you ever need to take out a mortgage for a home, you’ll need to present a Tax Compliance Certificate. This can only be obtained if your returns are appropriately filed and recorded.

Additionally, if you don’t submit your tax returns, you could be missing out on rebates. These are partial refunds when you pay too much tax. And why let SARS keep your money if you are due a refund?

Navigating your tax return

Rebates and deductions

There are many tax deductions that result in a rebate at the end of the tax year. Here are a few examples, though, this is not an exhaustive list.

Contributions to any retirement funds (pension, provident or retirement annuity)
Contributions to a registered medical-aid fund.
Donations to registered Public Benefit Organisations
If you’re a salaried employee but work mainly from home in a designated space, you may be able to deduct certain running costs like rent, rates, electricity, and wear-and- tear on personal office equipment.

Submitting your tax return

Each year, remember to submit your personal income tax returns on time. The tax season is not a time for procrastination. SARS have recently become stricter with their penalties for late submissions. Find all the latest dates and deadlines on the SARS website here: https://www.sars.gov.za/types-of-tax/personal-income-tax/filing-season/

The following is the most important documentation to submit your return.

Your SARS issued tax reference number.
The applicable tax return form, usually ITR12.
Any documentation relating to income received or accrued, such as remuneration that has not been reported to SARS by your employer.
Any documentation relating to the allowable deductions you wish to claim, for example certificates reflecting medical aid and retirement fund contributions over the tax year.

SARS

Auto assessments

SARS will issue auto assessments to taxpayers whose tax affairs are less complicated. If you have been selected for an auto assessment, you will be notified by SMS or email. (SARS receives data from employers, medical schemes, banks, retirement annuity funds and other institutions to calculate your assessment.) The next step is to review the assessment on the SARS MobiApp or eFiling. If you agree with the assessment, no further action is required. If you want to query the assessment, you may amend and file the return manually via SARS eFiling.

You don’t have to do it alone

It’s essential to note that individual circumstances may vary, and additional documents may be necessary depending on your specific situation. That’s where the professional help comes in. Like your financial adviser or TaxTim.