Along with the chill of winter, the opening of income tax season next month may send shivers down your spine. The official date from which you can file your tax return (ITR12) this year is Sunday, 1st July 2018. From that point, taxpayers can start submitting their 2018 personal income tax returns for the 2017/18 tax year, which runs from 1st March 2017 to 28th February 2018.
Due to the country’s flailing economic growth and its huge budget deficit, SARS is under extra pressure this year to meet revenue targets. If you earn a taxable income from a salary, commission or fees, you will need to pay income tax. And if this income is above the tax threshold for the past year of assessment, you should register as a taxpayer with SARS and file a tax return online via the eFiling system. If you are younger than 65 years old, this threshold is ZAR75,750 and it increases to ZAR117,300 if you are between 65 and 74 years old.
Although you need to register if you are above the threshold, it’s worth noting that if you have just one employer and your gross salary for the full year of assessment is under ZAR350,000 then it’s not compulsory to submit an actual return. This is provided that you don’t have any additional sources of income and don’t wish to claim any allowable tax deductions, such as for medical expenses or retirement annuities. If you are unsure about whether you need to submit an income tax return, please send us a quick message with our form, email or phone.
If you earn any income other than your salary, then you are a provisional taxpayer, which means you have to file provisional tax returns, known as IRP6s. For provisional taxpayers, tax season normally runs from July to November. There are three periods — the filing and payment of your first provisional tax is due on 31st August (this represents 50% of your estimated annualised tax liability). The second installment is then due on 28th February (this is the other estimated 50%) and then you will need to pay any remaining balance by 30th September after you have worked out the actual tax liability for the year.
To complete the process, you will need to prove your income by submitting documents, such as an IRP5/IT3(a) from your employer or pension fund, financial statements, tax certificates for investment income, and tax-free investments certificate(s). You will also need to show proof of any allowable deductions, such as medical aid contribution certificates and receipts, retirement annuity contribution certificates, a travel logbook if you receive a travel allowance or use a company car, and information pertaining to any withheld foreign tax credits.
If you visit a SARS branch to submit your return, rather than completing it online via eFiling, then be sure to bring a proof of identity, such as your ID, passport or driving licence.
SARS is reportedly striving to provide good services to taxpayers during tax season by implementing additional security measures for those who need to change any personal details (taxpayers will be required to show their ID, scan their fingerprints, and have their photo verified by Home Affairs).
It is advisable to use the eFiling platform to submit your tax returns as this can be accessed 24/7 and is the easiest way to submit a return. Any eFilers can also make use of the free Help-You-eFile service by clicking on the Help-You-eFile icon and following the steps to be put in touch with a SARS agent who can hopefully be of assistance. Furthermore, don’t hesitate to arrange a meeting to discuss any of your obligations and how they could affect your financial situation.