The COSMO Girl’s Easy Guide to Filing a Tax Return Online
Jo’burg tax expert Charel Wright of Wright Business Partners knows you’re scared of filing your tax return yourself. She’s here to tell you everything you need to know to DIY tax season 2018
TTax season opened on 1 July, and if Wright – a SAIT-registered tax practitioner with a diploma in financial planning – knows anything about this date, it’s that you probably ignored it like a 2am text from your ex. But there’s an argument for not blue-ticking the taxman: ‘ The positive spin on this date is that you have an opportunity to receive any refunds due from SARS, which you can use for a new handbag or a holiday,’ she says. Unfortunately, it’s also true that you might have to pay in for any shortfalls. But don’t let that get you down – there are some legal ways to save on tax.
If you’re a full-time employee earning a salary, the most important rule is not to miss the submission deadlines. ‘If you do, you’ll be liable to pay penalties,’ says Wright. Pull up your calendar and mark these dates RN:
• 21 September 2018: Deadline for tax returns submitted via post or dropped off at a SARS branch.
• 31 October 2018: Deadline for e-filing.
• 31 January 2019: Deadline for e-filing for provisional taxpayers.
Okay, let’s pause right there. What’s a provisional taxpayer? ‘A provisional taxpayer – like a freelancer – earns an income other than a salary from an employer ,’ says Wright. Most employees are non-provisional taxpayers, but if you’re confused about whether or not this includes you, she suggests contacting a tax professional for advice.
Didn’t tick any of the items on that list? In that case, you need to submit a tax return this year.
‘I’ve been a tax practitioner for 20 years, and we’ve seen many changes to the system of tax filing,’ says Wright. ‘Thankfully, SARS has tried to fix many of the complications involved in submitting tax returns. One of the positive changes was the introduction of e-filing, which makes it possible to file returns online. You could use a registered tax practitioner or file it yourself – but I often wonder how many clients filing their own returns are doing it correctly and receiving the full benefits.
A tax practitioner is not a miracle worker, so we can’t claim more money than you’re legally due – but we have the knowledge to advise you on different ways to optimise your tax savings, and to ensure that the information supplied to SARS is correct and in accordance with prescribed laws. We also have extensive knowledge about what can and can’t be claimed from SARS, as well as how to do it correctly.
‘A few common mistakes we see involve incorrectly completing the sections on medical contributions and expenses, forgetting to submit retirement annuity payments or supplying incomplete information about capital gains tax. This could be detrimental to the outcome of your submission. If you’re confused, contact a professional for assistance. It might cost you a little bit in fees, but should you end up having to correct the wrong information that was submitted, it will cost you even more. Completing your e-filing returns isn’t difficult, but filing them correctly is very important.’
According to Wright, the average cost for the completion of an employee’s tax return by a registered tax practitioner is about R650 – but it may vary according to your profile. This is a professional fee and usually includes compiling your information, completing and submitting your return and handling correspondence. If SARS decides to audit you, and additional work is required, an additional fee may be charged.
So you’re ready to do the thing and submit your tax returns on time,
but your main objective is to find out whether you can actually save on your taxes or get anything back from the taxman. Wright says there are a few ways in which you can save. ‘Retirement annuities, pensions and provident funds are a double whammy when it comes to saving on tax,’ she says. ‘You’re saving for your pension and receiving tax relief. By contributing towards your retirement in one of these ways, you could deduct up to 27,5% of your gross remuneration or taxable income, subject to an annual limit of R350 000.’
The one question Wright hears most often is, ‘Why is my colleague, who earns the same income as I do, getting more money back?’ ‘Every person’s tax profile differs, even if it’s not obvious,’ she says. ‘Your colleague might be paying more into a retirement annuity or driving more business kilometres. There is never an obvious answer unless you have all the details.
‘ The main reason people find it intimidating to do their own taxes is the fear of making a mistake and having to pay the taxman extra. But unless you earn additional income apart from your salary, this shouldn’t be the case. Employers, by law, have to deduct the correct tax according to your income and pay this to SARS. If you find that you have an amount owing to the Receiver, it’s a good idea to have the assessment checked and verified. There are ways to have it corrected, in case you submitted the wrong information or completed the return incorrectly. Never just accept the word of SARS without making sure that you do actually owe them. But always ensure that you provide SARS with accurate information – and consult a professional if in doubt.’
‘The main reason people ind it intimidating to do their own taxes is the fear of making a mistake and having to pay the taxman extra’