1 July 2016 marked the opening of the new tax season which means that individuals are able to complete and submit their income tax returns. eFiling via the official SARS website is undoubtedly the most efficient way of filing one’s tax returns and ensuring that any refunds due to you are paid as soon as possible. Crue’s legal advisor and tax expert, Eric Jordaan, recently appeared on SABC 3’s Expresso Morning Show to provide viewers insight into how to make eFiling easy. Here’s how:
What is the current assessment period?
The 2016 tax year started on 1 March 2015 and ended on 29 February 2016, and this is referred to as the assessment period. The tax season for individuals runs from 1 July 2016 to 25 November 2016, and during this period you need to submit your tax return which is known as an ITR12. This will allow SARS to reconcile the tax on your income and the tax deductible expenses for the year of assessment. Bear in mind that you can only claim for deductions that were applicable for the assessment period (1/3/2015 to 29/2/2016).
Who needs to submit a tax return?
If you earn under R350 000 for a full year from one employer (that’s your total salary income before tax) and have no other sources of additional income (for example, interest or rental income) and no deductions that you want to claim (for example medical expenses, travel or retirement annuities), then you don’t need to submit a return.
What is the easiest way to submit my tax return?
Without a doubt, eFiling is the most efficient way of filing your tax return. SARS runs an excellent website at www.sarsefiling.co.za. To complete the registration process you will need at hand:
- Your tax registration number/s
- Your ID number
- Your personal details
When do I need to file my tax return by?
The date by which you must file your return depends on how you submit it and whether or not you are a provisional taxpayer. The deadlines are as follows:
- If you are not a provisional taxpayer and you file your return via eFiling, the due date is 25 November 2016.
- If you are a provisional taxpayer and you file your return via eFiling, you must file by 31 January 2017.
- If you submit your return by post or drop it off at a SARS branch, irrespective of whether you are or are not a provisional taxpayer, the deadline is 23 September 2016.
- If you file your return electronically at a SARS branch, irrespective of whether or not you are a provisional taxpayer, the deadline is 25 November 2016.
What documents will I need when filing my tax return?
To get ready to submit your tax return, you will need to gather all your supporting documentation which would include the following:
- IRP5 and/or IT3(a) certificates from your employer or pension fund
- IT3(b) certificates for investment returns
- Financial statements (if applicable)
- Medical aid contribution certificates and receipts
- Retirement annuity certificates
- Certificates for local interest income earned
- Logbook and other documents in support of business travel expenses
- Bank account details
Remember, if you are using eFiling, you will not need to submit these documents to SARS, but you will be required to keep them safely for a period of five years.
How quickly will SARS process my tax return?
The sooner you submit your return, the sooner you can expect to receive any refund that is due to you. According to SARS, of the R15 billion that it refunded to 1.82 million taxpayers in last year’s tax season, 95% was paid out within 72 hours of the returns being submitted. Last year, 95% of returns were assessed within three seconds and more than 99% within 24 hours.
To ensure that your tax return is processed expediently, it is vital to ensure that all information is accurately captured and that you only use information and figures that reflect on your supporting documents. For example, for the current year of assessment, you will only be entitled to claim retirement fund contributions up to 15% of your taxable income as the new 27.5% ruling is only applicable to your 2017 return. If you are claiming for medical expenses that you could not recover from your medical aid, make sure that the expenses were incurred during the 2016 tax year. Bear in mind that, if one is audited by SARS, the taxpayer will be required to produce all supporting documentation and information that was used as the basis for the eFiling.
Most importantly, tax season provides fraudsters with fresh opportunities to steal your money. Most commonly, fraudsters send emails bearing the SARS branding asking taxpayers to verify their details or advising of a refund. To avoid becoming the victim of a SARS scam, bear in mind that SARS will never request your banking or personal details via any communication that one receives by post, email, phone or sms. In addition, SARS will never send any hyperlinks leading to another website, even those of banks.
Although Albert Einstein believed that “the hardest thing to understand in the world is income tax”, the South African Revenue Service has done a world class job of streamlining tax filing for all South Africans via the eFiling system.
Have an awesome Tuesday!