Beware the taxman
Those who use this facility will not have to visit a South African Revenue Service (SARS) branch, though, in certain circumstances, SARS will require original documents to be submitted for verification.
This year’s tax return deadline is July 14. SARS will levy penalties on individuals who:
- Do not submit their income tax returns on time;
- Do not disclose all of their income in the return; and
- Make a false declaration in the return.
The penalties are stiff – up to 200% of the tax payable.
SARS may charge interest if you are late in paying tax, at 10.5% per annum.
You are liable for a fine, and perhaps even jail, if you:
- Fail to pay the tax you are supposed to (tax evasion);
- Fail to complete a tax return if you are supposed to; and
- Fail to disclose all your income in the return.
No blanket extensions will be granted this year, but if you have legitimate grounds for an extension, you must apply before 14 July.
- What documents do you need?
Your employer should have given you an IRP5 certificate – a record of how much you earned in the year, how much tax was paid, and the amount paid to pension fund and medical aid – within six weeks of the end of the tax year (end-February). Contact your human resources department if you have not received one.
If you receive a travel allowance and have a medical aid, you can claim tax deductions – but you must prove these with documents such as medical bills and a log book of your travel.
Retirement annuities are a way to get a tax break. You need a certificate from your institution detailing your RA contributions during the tax year.
Interest you receive on unit trusts and cash in the bank is taxable, after a certain limit. You must prove how much interest you received with an IT3(b) certificate.
While local dividends are not taxable – and thus don’t need to be declared – foreign dividends are (after a certain level), and any foreign interest or foreign dividends should be listed on an IT3(b) certificate.
- When do you need to register as a taxpayer?
Any employee who earns a salary of more than R60000 a year after pension and allowable RA contributions must register for income tax purposes.
Also, anyone who earns interest income of more than R15000 a year; who earns rental income; who derives income from a business; or who is a member of a company or close corporation must register.
You can register at a SARS branch or on the website (www.sars.co.za).
Should you earn less than R60000 a year, you need not register as SITE (standard income tax on employees) will be deducted from your salary.
Pensioners who receive a pension and/or wages exceeding R60000 a year – or have investment income that takes the total to more than R60000 a year – must submit a tax return.
However, over-65s can claim larger interest-income exemption than people younger than 65, as per the SARS tax tables.
- Benefits of going online?
Electronic submission allows for automatic calculation of travelling expenditure and capital gains tax.
Register for the service at www.sarsefiling.co.za. Phone the SARS call centre on 0860 709 709 with any queries.
SARS can put you in touch with a consultant to help you fill in your tax return, at no charge.
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