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Throughout August, SARS plans on auto-assessing around 3,1 million people.
This seemed like a good idea when it was first announced. It would take some of the strain off the revenue service in September when tax season starts for individual tax practitioners, especially in light of the delays brought on by the pandemic.
You may have already received an SMS from SARS, or else one might be arriving soon.
Now that the process is underway, not every aspect is going exactly to plan.
Some taxpayers seem to believe that the auto-assessments means that they no longer have to worry about whether their tax submissions are correct.
The responsibility for ensuring that all information submitted to SARS is there and in order, however, still lies with the taxpayer, and to assume otherwise would be a mistake.
As MyBroadband points out, “neglecting to check the data for completeness and accuracy may be seen by the tax authority as a deliberate attempt to evade tax and could result in stiff penalties”.
In addition, numerous people have reported that the ‘tax back’ amount SARS stated via SMS was significantly lower than what they ended up receiving, even after making only minor adjustments to their return via eFiling.
Knowledge is power, so let’s break down how all of this works so that you’re armed and ready if you’re auto-assessed.
SARS selects people to be auto-assessed by collecting electronic tax data such as certificates provided by employers, financial institutions, medical schemes, retirement annuity fund administrators, and other third-party data providers.
While those items are usually submitted by the parties that issue them, it’s important that you check that said parties have submitted the relevant documents. It’s also important that you check your personal information, and that the entire form is filled out.
Furthermore, the system is “prone to teething problems” and some of the precompiled information could be inaccurate.
If you have a business on the side, property rentals, or other sources of income, it might not reflect on your tax return. Similarly, deductions such as travel allowances can only be captured by the employee’s own records.
If you’re unsure how to check your auto-assessment or your tax details, the following video takes you through the process of viewing your auto-assessment, accepting or rejecting it, and editing your information:
If you are not auto-assessed by SARS, it may be that SARS does not have enough third-party information to populate your return.
Either way, to avoid any failure to report earnings accurately, and to make sure that you receive the tax return that you’re owed, you need to be vigilant with your tax forms.
Still, most of us aren’t equipped to handle the complexities of taxes, especially when you’re not dealing with a single source of income, or are trying to maximise returns and ensure complete accuracy.
If you’re smart, or want to ensure that you or your business tick all of the boxes, you’ll hand things over to an expert.
Galbraith | Rushby offers professional tax compliance and advisory services to individuals and businesses.
They’ll handle the complicated stuff, so that you can do the fun work of planning what you’re going to do with your tax return.
[source:mybroadband]
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