The tax filing 2017/18 submission deadline is fast approaching. For non-provisional taxpayers that deadline is October 31 2018. Sars has already indicated that it will not be as lenient as in previous years regarding imposing penalties for late submissions.
One of the questions that gets asked repeatedly is whether you are required to submit a tax return. You can go to the Sars website for an online tool that will guide you to determine if you are liable to submit a return or not.
Use a registered tax professional
Individuals can choose to file their own returns, but it is strongly advised that you make use of a professional to avoid some of the pitfalls when it comes to dealing with Sars.
The first step to ensure that you select the right person to handle your tax submission is to choose a Sars-registered tax practitioner. A good place to start your search is the South African Institute of Professional Accountants (www.saipa.co.za) or the South African Institute of Tax Professionals (www.thesait.org.za) or any other relevant sites such as www.findanaccountant.co.za.
Another great way to find a good tax practitioner is to ask your friends, family and colleagues for a reference and to ask them how they rate the service they get from their tax practitioner.
The fees for a tax practitioner to submit your return can vary depending on how complex your particular return is and the amount of work it requires. For example, a very basic return for someone who only has an IRP5 can start at a fee of a few hundred rand, whereas a complex return for someone with multiple sources of income can cost several thousand rand.
The tax season opens on July 1 each year. Some great advice is to submit all your information and supporting documentation to your tax practitioner as early as possible. Most people wait until the last week or two before the deadline and this often causes delays in getting your return submitted. It is important to keep a record of all your tax-relevant documentation throughout the year, as your tax practitioner will need this to ensure your return is completed accurately. This may include your IRP5, IT3 certificates, a travel log book, invoices for medical expenses as well as your medical aid contribution certificate, and more.
Make sure that you provide your tax practitioner with accurate and complete information. This will enable him/her to submit your return accurately and avoid any delays in finalising the process. The submission of inaccurate information can lead to queries and even penalties for under-declaration of income.
Make sure that you optimise your retirement contributions to tax-deductible investment products such as a retirement annuity (RA). This will help fund your retirement savings for later years.
Talk to your employer about structuring your remuneration package in a manner that suits your circumstances, and if you receive a travel allowance make sure that the amount is determined accurately.
Finally, ask for a copy of your assessment from your tax practitioner before the October 31 deadline. This is the only way to prove that your return has been submitted.
If you are still filing your return manually, it is strongly advised that you register on eFiling and do your submissions electronically.
eFiling is the website where tax-return submissions are done electronically, which makes this a highly efficient avenue as a lot of the information required on your return is already pre-populated. Submissions are done electronically and in most cases your tax assessment is issued immediately upon submission of your return. eFiling has the history of all your returns and assessments done each year and you can request an up-to-date statement of your account to see if you have any amounts owing to Sars. Sars will also send all communications to you via the eFiling website. eFiling also allows you to check your tax compliance status to see if you are compliant as well as request tax clearance certificates.
To make use of eFiling, you will need a computer with access to the internet in order to register on the eFiling website.