We’re living in a world of convenience and technology, but now we are advised to not look for comfort in the wrong places, especially when it comes to our taxes.
The South African Revenue Service (SARS) has begun to auto-assess individual taxpayers which could lead some people to believe they no longer need to worry about their tax submissions. This sounds like great news for us busy people.
This is not the case, says Thamsanqa Msiza, head of Individual Tax Returns at Tax Consulting South Africa. “The onus still lies with the taxpayer to ensure all information submitted to SARS is complete and correct,” he said speaking to Business Tech.
According to the head of Individual Tax Returns, neglecting to do so may be seen by the tax authority as a deliberate attempt to evade tax and could result in stiff penalties.
You need always make sure that everything has been submitted correctly. Check every detail.
What is a SARS auto-assessment?
With modern digital technologies at its disposal, SARS can collect electronic tax data from employers, financial institutions, medical schemes, retirement annuity fund administrators and other third-party data providers.
As such, it can compile and assess tax submissions with little input from the taxpayer.
SARS announced that, during August, it would assess a large number of taxpayers automatically in this way, reportedly around 3.1 million.
They will be notified by SMS and can access the pre-compiled assessment through eFiling or SARS’ MobiApp. Here, they can review the assessment and click an Accept button to accept the figures, or click an ‘Edit button’ to amend the information.
What to watch out for:
Even those who are employed may earn extra on the side from gigs, property rentals or other sources of income. Similarly, individuals who are self-employed and have received taxable earnings exceeding R83,100 in the 2019/2020 tax year, will be considered Provisional Taxpayers and must declare this income as SARS will have no record of it.
Other instances highlighted by Msiza include an investment tax certificate, for example, appearing on the assessment although the taxpayer holds no such investment. Or an employer may fail to submit a copy of the employee’s IRP5.
There may also be special deductions, like logbook mileage against one’s travel allowance, that can only be captured from an employee’s records. Or donations for which no tax certificate has been loaded on the return.
A convenience, not a pass
A SARS auto-assessment will be a welcome convenience for many just as I had mentioned in the beginning. However, it doesn’t take all the work out of tax submissions and does not release the taxpayer from the responsibility of declaring all their earnings accurately.
“If you receive an SMS notifying you that you have been auto-assessed, take the time to check the preloaded information carefully against your own tax certificates,” said Msiza to Business Tech.
Those with complex tax affairs should be particularly cautious and should seek direction from their tax attorney or tax practitioner.
This way, they will avoid unpleasant surprises later on and assure themselves that they have made effective use of any tax relief to which they are legally entitled.
To be on the safe side, get a professional to handle your taxes for you and get a peace of mind. Get in touch with me on email@example.com. CVW provides a range of accounting and bookkeeping services to businesses across South Africa.
Thanks to Business Tech as the source for the information. See the original article here: https://businesstech.co.za/news/finance/424682/think-twice-before-accepting-your-sars-auto-assessment/?fbclid=IwAR27QF6yCVfyIIkdaHnWqkCCf25w6TxpAUy2jdQ2uccUpYlddyuzTtgkyuQ