CAPE TOWN – To reduce the number of visitors to their offices, the South African Revenue Service (Sars) recently broadened the criteria for people who are not required to submit a tax return. If your total earnings for the 2018 tax year were no more than R350 000 you might not have to submit a return. However, while the prospect of not having to do your taxes might seem appealing, choosing to forego filing a return could result in you losing out on a healthy refund from the taxman.
Last year, Sars paid back R19.8 billion in tax refunds so, if you want a piece of this year’s pie, it’s advisable to submit your tax return before the deadline of October 31 to avoid penalties and reap the rewards.
“The cost of living in South Africa is on the rise, no thanks to things like rising fuel costs and the increase to VAT earlier this year. Being well prepared during tax season is just one way to ensure that consumers can try to cope with their increased expenses and even recuperate some of their expenditure from SARS,” says Taryn Schmidt, Wonga South Africa’s chief marketing officer.
As part of their continued focus on financial literacy, Wonga has outlined some important points about the 2018 tax year that financially savvy taxpayers should be cognisant of.
1. Not everyone needs to submit a tax return
You do not need to submit a return if your total employment income for the year (March 2017 to February 2018) was no more than R350 000 before tax. During this period, you must also have only received an income from one employer and not received any additional income such as rent, interest on an investment or a car or travel allowance. Lastly, you must submit a tax return if you want to claim tax related reductions or rebates.
2. Qualifying for a tax rebate
There are a number of tax deductible items that could put you in the running for a refund from SARS. For example, if you contributed to a pension fund, retirement annuity, medical aid scheme or Public Benefit Organisation (PBO) make sure you note these payments in your tax return. Certain charities are registered as PBO’s because, in recognition of their dependence on the public’s generosity, the South African government has incentivised donations. However, not all non-profits are registered as PBOs and, in order to claim a rebate, you must have been issued with a section 18A receipt by the charity.
3. Use eFiling
If you feel like the deadline for submitting your tax return has come around quickly, you’d be right. This year, the tax season will be 18 business days shorter than usual, to allow more time for verification prior to the December holidays. The deadline for provisional and non-provisional tax payers to submit returns at a SARS branch or by post has already passed, meaning that you will have to submit your return electronically using eFiling. SARS is also encouraging the use of eFiling to alleviate the pressure on its branches, through which 120 000 returns were submitted last year.
The upside is that, provided you have the right documentation, the system is relatively easy to use. If you haven’t done so already visit www.sarsefiling.co.za to register. You’ll need:
- Your IRP5/IT3 certificate, which you will receive from your employer.
- Medical aid certificates as well as details of any other medical expenses that weren’t covered by your medical aid.
- Pension and retirement annuity certificates.
- Your banking details.
- Your travel logbook, if you receive a travel allowance.
- Tax certificates that you received in respect of an investment income.
- Where applicable, an ITR-DD form as confirmation of the diagnosis of a disability.
- And any other documentation relating to income you received or deductions you want to claim.
4. Make sure you meet the deadlines
The eFiling deadline for non-provisional taxpayers, those who only earn a salary, is 31 October 2018, whereas the deadline for provisional taxpayers, those who earn an additional income over and above their salary, is 31 January 2019.
Times are tough and a little extra might go a long way. So, if you could qualify for a rebate, be sure you fill out your tax return now before it’s too late.