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How to do your taxes right isn’t always easy to figure out, and the last thing anyone wants is to be in trouble with the tax man. Scorpion Legal Protection answers questions like: Can the SARS auto-assessments be wrong? How will SARS know if I’m lying? If I get SARS to help me online or in-branch, I won’t have any problems, right?
Wrong. The auto-assessments from SARS are calculated by using the information provided to SARS by third parties like your employer, medical aid, provident fund scheme, etc. They are not automatically correct, and if you hit ‘Accept’ without checking the assessment, you will still be responsible if it’s incorrect. The problem is that the auto-assessments may not include things like travel allowances or additional allowable deductions. For example, if you have been working from home during the pandemic, you could qualify for certain home office deductions.
If it turns out that SARS calculated things incorrectly, you will still be responsible for your income tax submission because you are responsible for checking that everything is correct.
You should not claim for anything you cannot prove. SARS can decide to audit anyone at any time. If this happens, you will need to be able to prove what you are claiming for – claiming is not as simple as filling in on a form what you think SARS owes you. This means you need to have physical/electronic evidence in the form of receipts, contracts, bank statements, etc. If you claim for home office expenses, for example, you must be able to prove every expense – cellphone bill showing which calls were for business, building plans, receipts for cleaning services, internet bill, receipts for any stationery/equipment you claim to have bought over the tax year, bank statements.
If you are caught lying, you could face harsh fines. To get an idea of what SARS’ penalties are like, the penalty for not submitting a tax return when you should have can be as much as R16 000 per month for each month that the non-compliance continues.
No. Your tax return remains your responsibility. SARS may be able to help you, but there is no guarantee that the person helping you is doing your taxes correctly. If they help you and there is a mistake on your submission, you will still be responsible for it.
Not necessarily. There are a number of factors that decide whether or not you need to submit a tax return, it is not just about how much you earn.
If you have a pension or provident fund, medical aid or you received any benefits like a travel or cellphone allowance from your employer, you need to submit a return even if your income is below the threshold. If you were employed by more than one employer during the tax year, you have to submit a return. If you are employed by one employer, but receive a government pension from a spouse or deceased spouse or a divorce, these also count as a second income and you would need to submit a return.
For more information directly from SARS on whether or not you need to submit a return, please click here.
No. This is why it is so important to double check that your tax return is 100% correct before you submit it. If you get a refund you aren’t actually due, SARS can demand this money back later with interest and additional penalties.
Scorpion’s Tax Helpdesk is available to our Legal Policy A & Platinum A members for full help and advice in submitting their personal income taxes. Our registered tax practitioners can ensure that your taxes are done right, and that there are no nasty surprises from the tax man later along the line. And even if there are, as long as your policy with us is active, we will be there to help. Let Scorpion do your taxes for you.
Click here to find out more.
* This is only basic tax advice and cannot be relied on solely. The information is correct at the time of being sent to publishing. This is not financial advice.
Date added: 30 July 2021