What you need to know about paying tax is that it has become easier, even if you have not registered for Sars eFiling or you do not have a tax number.
Tax season started on 1 July, but it is one of those tasks that consumers often promise to come back to later because they find it so daunting.
However, according to TaxTim, a digital tax assistant, getting a tax number is now as easy as registering on SARS eFiling if you have a valid South African ID.
If you are a returning taxpayer, TaxTim has these tips for consumers who have decided to get their tax done and dusted:
- Ensure your bank details are up to date. You can update your bank details online using your SARS eFiling profile, but you may be required to make a Sars appointment to update your details.
- Ensure your contact details are correct, such as your physical address, contact numbers and email address. You can do also do this on eFiling by selecting ‘SARS Registered Details’ and then ‘Maintain SARS Registered Details.’
- Check your tax compliance by making sure you have filed all past tax returns and that you do not have any outstanding Sars penalties or tax debt. If you owe Sars any money for prior years, this may delay payment of your current year’s refund.
- Get these documents ready: an IRP5/IT3a from your employer or retirement fund, medical aid certificate, IT3b/IT3c showing your investments, your retirement annuity certificate, a PBO certificate showing your donations and a travel logbook for business travel.
If you were retrenched, or withdrew or transferred from your retirement fund, you should receive a IRP5/IT3a from your employer or fund which must be included in your tax return. Leaving it out by mistake, will delay your assessment and potentially your refund too.
Self-employed? Keep proper records
If you run your own business, you can claim all your business-related expenses against your business income.
Taxpayers in this category include sole proprietors, commission earners, independent contractors and freelancers.
Keep an accurate record of your income and expenses, together with the related invoices and receipts. Sars may disallow your expenses if you are unable to provide adequate supporting documents.
If you mainly work from home, check if you qualify to claim a home office deduction.
Sars auto assessments
Although Sars has done auto assessments on a portion of taxpayers, TaxTim advises that taxpayers rather not accept the auto assessment and rather file their tax return themselves.
This will prevent you from losing out on your full refund, or in the worst-case scenario, not receive a refund at all.
The auto-assessment does not allow you to claim tax deductions such as travel expenses, donations, home office and wear and tear of assets, nor will it include any extra medical expenses you paid yourself.
It is better to submit your tax return as soon as possible within the tax season. If you leave it to the last minute and run into an issue, you could miss the deadline and incur unnecessary penalties.
Why do I owe SARS more money?
According to TaxTim, it is possible to find that instead of getting money back, you actually have to pay Sars.
This could come as a nasty surprise, especially if you (mis)calculated and had planned on spending that extra bit of income.
You could owe Sars money because you:
- worked for multiple employers and received multiple IRP5s
- are a pensioner and receive a monthly pension
- received a travel allowance, but did not keep a logbook
- receive a travel allowance, but did not drive much for work
- used a company car, but you did not keep a logbook
- have access to a company car, but you do not drive much for work
- earned investment income
- earned profit from a rental
- you run your own business or freelance on the side
- the number of dependents on your medical aid has decreased
- your Retirement Annuity (RA) contributions on your IRP5 are greater than the total RA contributions on your tax certificate.