Tax Season: How to be tax wise
The tax season is here but does the whole process just confuse you? Don’t worry we’re here to answer all your questions.
What is income tax?
Most people who are employed need to pay their government a portion of their salary. What you pay depends on how much money you earn.
Why do I pay it?
Tax helps to build a better South Africa. The government uses the money to pay for roads, schools, hospitals and security.
Who doesn’t have to register as a tax payer?
Not every South African has to submit a tax return.
– If you earn less than R250 000 for a full year of work AND
– You’ve only worked for one employer AND
– You have no other income (interest, rent) AND
– Have no claims for medical or travel expenses, or retirement annuity contributions
Who does have to register?
-If you earned more than R70 700 between 1 March 2014 – 28 Feb 2015 and you’re younger than 65 years
How do I register?
A first-time taxpayer must register at a South African Revenue Service (SARS) branch to get a tax number. Fill in a registration form (IT 77) and take these documents with you:
– A certified copy of your ID, passport or driver’s licence
– Proof of address (phone bill, bank statement)
– Original bank statement stamped by your bank (not older than 3 months)
Does it cost me to register?
No, registration is free.
I’m registered, what happens now?
You need to complete and hand in your income tax return (ITR12). There are four ways that you can do this.
1. Online: Register with SARS eFiling and complete return electronically
2. Mobile: Register with SARS eFiling and use their mobisite or download the eFiling app onto your smartphone
3. Branch: Visit any SARS office and someone will help you fill in your forms electronically
4. Post: SARS will send you the forms using the Post Office, fill these in and post them back to SARS
To complete your tax return you need the following documents, but you don’t hand them in to SARS, you keep them safe for at least 5 years in case SARS requests them.
– IRP5 certificate (get this from your employer/pension fund)
– Medical certificates and relevant documents if you want to claim
– Pension and retirement annuity certificates
– Travel logbook (if you have a travel allowance or company car)
– Any documents showing income received that you haven’t reported to SARS
– Tax certificates you get from investment income
– Disability form if necessary
– Information for capital gains if necessary
– Financial statements from business income (such as receiving rent)
– Any documents relating to income or deductions you want to claim
What if I don’t want to pay tax?
It’s a crime to not pay your tax and if you’re caught you could be fined or sent to jail.
When do I have to pay?
For individuals, the tax season 2014 started on 1st July. Your deadline depends on how you submit your return.
– 26 September 2014: By post if using a SARS drop box
– 21 November 2014: Electronically at a SARS branch
– 21 November 2014: Non-provisional taxpayers using eFiling
– 30 January 2015: Provisional taxpayers using eFiling
I’ve submitted my form, what happens now?
Nothing! SARS will calculate how much tax you should pay. If you’ve paid too much you get a refund and if you’ve paid too little you will need to pay the outstanding amount.
– Submit on time and honestly
– Beware of scams – only use a trusted source
– There are free tax education workshops at SARS branches around South Africa
– Get help from an independent tax consultant, your payroll manager or your local SARS branch
GetMore has a team of financial experts available 24/7 to answer all your tax questions. For free advice call 084 11 438 48.