It always feels like a boon when it happens.
A windfall from the taxman feels like a bit of a 13th cheque. And for those of us with tax consultants or financial advisors who know how to ensure all our affairs are in order so that SARS will pay us something substantial, it pays to always ensure we are tax-compliant and prepared for the beginning of the new tax season.
This year, SARS did things a bit differently though. Before you could even accept your auto-assessment, the amount due to you was in your bank account, making many wonder if they aren’t being short-changed.
“This year we will again issue auto-assessments to taxpayers whose tax affairs are less complicated. However, we have made it much easier this year – if you are in agreement with your auto-assessment then there is no need to ‘accept’ the assessment,” says the Revenue Service on its website, explaining how this year’s auto-assessment differs from last year’s, which gave you an option to file your taxes yourself or through a tax practitioner or your accountant, even if you had gotten an auto-assessment notice.
“If SARS did not get your assessment right, you can still let us know by filing a tax return in the normal way, with the additional information, within 40 business days of the date of your assessment.”
Tax filing season opened on Friday, 1 July, leaving many income-earners anxious.
Among concerns like suddenly being told you owe the taxman a fortune are the niggling stresses of having to search for misplaced documents and forgotten receipts, uncertainty about which tax deductions to claims and how to avoid mistakes that could result in refund delays.
“If a refund is due to you, then the refund will follow automatically – you do not have to ask for it,” says SARS.
“This takes approximately seventy-two (72) hours from the date on which we issued your assessment to you on eFiling or SARS MobiApp, but in some cases a little bit longer. It is important to ensure that your banking details with SARS are correct in order for SARS to pay the refund successfully.”
The point of the SARS auto-assessment process is that it’s supposed to be simpler for those whose tax affairs are relatively straightforward – for example, company employees with a single source of income. Three million non-provisional taxpayers form part of this process this year, and they will not have to file a tax return if SARS is satisfied with the outcome.
If you owe SARS money, you can pay via eFiling or the MobiApp.
If you disagree with the assessment, “there is no need to file an objection to the assessment,” says SARS.
“Simply access your tax return via eFiling or MobiApp, complete the return, and file it via eFiling or MobiApp within 40 business days from the date on which SARS issued your assessment to you.
“If you cannot file the tax return within 40 business days, you can request extension via eFiling or MobiApp.”
Factors that could require you to ask for an amendment to your auto-assessment
CHANGED TAX STATUS
Many people’s work status has, however, changed or become more complicated since the previous tax filing season. Thousands of people have been retrenched, changed jobs, become self-employed, left South Africa, or taken on freelance work in addition to their regular job.
Their personal status may also have changed due to marriage, divorce, or parenthood.
FIND OUT ABOUT THE TAX IMPLICATIONS OF MARRIAGE
“In general, it’s worth contacting SARS, your accountant, or a reputable tax practitioner if you are unsure about your changed tax status. This ensures that you get up-to-date advice tailored to your particular situation,” says Shafeeka Anthony, marketing manager of personal finance website Just Money.
“A professional’s fee could be covered by the tax savings, and you will also enjoy greater peace of mind.”
Before choosing a tax practitioner, shop around and ask the following:
- With which professional body are you registered?
- What are your fees, and what do they cover?
- Can you help with objections and appeals if I disagree with the SARS assessment? If so, what do you charge for this?
- Do you allow clients shared access to their eFiling profiles? (This allows you to receive SARS communication and hold the tax consultant accountable.)
To handle your tax efficiently, you need to be organised, retain your personal and business documents, and store these securely, adds Shafeeka.
Depending on the type of work you perform, you may be able to claim costs relating to your cell phone, rent, rates, electricity, accounting and tax fees, IT, your vehicle, and any other income-related goods and services.
You can only claim the usage that relates to your work, so receipts and records are important. You could save time and trouble by using a cloud-based accountancy package.
If you’re a South African taxpayer or tax resident, you are liable for tax on your worldwide assets and income.
Whether you work in South Africa or another country, you need to report your earnings to SARS and pay tax accordingly.
At the same time, any other country in which you earn income can also levy tax.
You will need proof of items such as medical bills and interest earned on investments to be eligible for claiming against these.
Even if you don’t need to submit supporting documentation, you must retain it for seven years.
SARS will need to see these items should they query a submission or perform an audit.
There are many ways to reduce your tax bill, from contributing to your retirement and investing in your children’s education, to supporting your favourite charity, provided it is appropriately registered.
Ensure that SARS has your up-to-date contact details, and if you receive a request, find out what it relates to before acting on it. It could be a phishing email, SMS or phone call.
Be wary of scammers during the period, warns Shafeeka. “Tax fraud is on the rise. Scammers may pretend to be a SARS official and ask for your confidential details. Fraudsters may also falsely inform you that you are under audit, or they may make an unauthorised change to your eFiling profile, using information obtained by phishing.”