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Taxes. Bleh.

As much as we would like to forget about the taxman, there is simply no way of avoiding paying your pound of flesh to Sars, except of course if you have a big sofa to keep some dollahs off the books. Seeing as how hiding your income from Sars is frowned upon and could likely end up in a visit from the man, you must give unto Caesar what belongs to Caesar.

Like we said, bleh.

So once you’ve made peace with the fact that it’s that time of year again, it’s a good idea to know that there has been some big changes to personal income tax returns, trust tax returns and pay-as-you-earn (PAYE) penalties for the Filing Season 2023.

These have quite an effect on individual taxpayers, trustees, employers and tax practitioners, so unless you have CA at the end of your title, it might be a good idea to get the professionals to advise you.

The experts can navigate this quagmire better than you, guaranteed. Keith Engel, the CEO of the South African Institute of Taxation (SAIT) puts it best: “The purpose of tax practitioners is to provide you with assurance that you don’t under-claim, and that you are safe and sound from a Sars audit.”

It’s an uncomfortable truth, which is why there are good reasons to use a registered tax practitioner.

Have you been auto-assessed?

Since last year, Sars commenced issuing “original estimated assessments” as part of the auto-assessment process to taxpayers whose tax affairs are seemingly uncomplicated.

Consider getting a tax practitioner to check your auto-assessed tax return. If you are not in agreement with the auto-assessment, you will have to file a tax return and a tax practitioner can do this on your behalf. This will ensure that you’ve claimed for all possible allowable expenses and can avoid penalties by declaring income and deductions accurately.

Personal income tax enhancements.

Sars has instituted various personal income tax enhancements this filing season that can be difficult to understand and calculate, in which case a registered tax practitioner can assist you in processing your tax return correctly.

These also cover assessments for spouses married in community of property, foreign income disclosures, and statements of assets and liabilities.

Trust income tax return enhancements.

Submitting trust tax returns can be complicated and it would be best to use a registered tax practitioner to file this type of return. There is a new, simplified return for passive trusts and the correct type of return must be selected on the Tax Return Wizard.

Other enhancements to the trust return (ITR12T) include a new field for credit agreements and debtors’ allowances “lay byes”, and a beneficial ownership declaration. All mandatory supporting documents must be uploaded and submitted with the trust return.

PAYE under-estimation penalties.

ax practitioners can help you avoid penalties or, if they are unavoidable, assist with administrative penalty adjustments.

A monthly administrative penalty of 10% of the total of the employee’s tax amount as estimated by Sars (on readily available information) may be payable if the total amount of employee tax deducted or withheld, or that should have been deducted or withheld for the period, is unknown.

You could get a refund within 72 hours (if one is due).

In preparation for Filing Season 2023, Sars sent out a statement saying it is taking a hard line with tax practitioners who submit inaccurate declarations. Compliant taxpayers enjoy a seamless experience, where their assessment is issued within five seconds of submission and a refund, where payable, is paid within 72 business hours.

Considering the complexities associated with certain types of tax returns, it’s a good idea to have a registered tax practitioner in your corner, so you can get some dosh back ASAP.

Despite the headache of tax season, the process can be made so much easier if you rely on people who know tax law as well as you know your own frown. For our peace of mind, we’ve always used Consequence Private Wealth to keep us on Sars’ good side.

They offer an excellent tax filing and accounting service for families and businesses, so you don’t have to lie awake at night. Let them do it for you!

[source:iol]