“The best way to teach your kids about taxes is by eating 30 percent of their ice cream” (Bill Murray)
The 2018 tax season for individuals opened on 1 July. Non-provisional taxpayers who use eFiling or file electronically at a SARS branch have had their submission deadline cut to 31 October. Other classes of taxpayers (provisional and those who manually submit their forms) are on similar deadlines to prior years.
This change stems from SARS streamlining the process this year. This has benefits for both taxpayers and SARS.How and why SARS is streamlining the process
- Nearly two thirds of non-provisional taxpayers’ returns are completed within three months i.e. they are in by end September. This is followed by a lull until the middle of November when there is a last minute rush to complete these returns.
SARS has brought the deadline for these taxpayers forward by three weeks. Thus taxpayers who either use eFiling or submit electronically at a SARS Branch must send in their returns by close of business on 31 October.This is significant as it affects the bulk of taxpayers. Make sure your staff members are aware of this date as there will be penalties and interest on late returns.
The reason for this change is twofold:
- It smoothes the workflow of SARS. The lull period they previously experienced will be taken up assessing returns in October. SARS will be able to request verification and finalise assessments by the Christmas break.
- The bulk of taxpayers in this category will now have their returns finalised in December. This will give these individuals more peace of mind as they are less likely to have to answer queries during the holiday break.
- 1.6 million taxpayers submitted tax returns last year when they did not need to do so. This adds unnecessary workload to these taxpayers and to SARS who are overwhelmed by the volume of work during filing season.
SARS has communicated with those 2017 taxpayers who unnecessarily submitted returns, urging them to only submit a return if they fall within SARS’ requirements. If this is successful, 25% less tax returns will be submitted.Taxpayers do not have to submit a tax return if:
- Their employment income is R350,000 or less for the year and
- They have one employer during the tax year and
- They have no other income such as rentals received, car allowance and
- They do not claim additional deductions e.g. medical costs, retirement funding.
- Approximately 860,000 eFiling registered taxpayers came into a SARS branch to do their tax returns in 2017.
These taxpayers will be assisted by the Help-you-eFile service which will connect a member of SARS directly to the taxpayer. The taxpayer will then be helped through the eFiling process. SARS hope this will significantly increase the number of eFiling returns.
- 120,000 tax practitioners used a SARS branch to complete their clients’ returns.
All tax practitioners will be encouraged to use eFiling for their clients’ submissions.
- Both taxpayers and SARS staff get inundated with documentation during filing season.
When requesting verification data, SARS will be specific about the documentation it requires. This will reduce paper flow and time spent on this process by both the taxpayer and SARS.
- 2018 returns will be prioritised and taxpayers submitting income tax forms from prior years will have to wait longer for assessments. SARS has found that many of the scams surrounding tax happen with past-due tax returns. This will give SARS more time to check and detect fraud.
- Lastly, SARS will net off refunds or amounts owed on past returns, giving taxpayers a better picture of what is due to them or what they owe.
Your 2018 Tax Season Deadlines
|Channel||Due Date||Type of Taxpayer|
|Manual by post or at a SARS Branch Drop Box||21 September 2018||Non-provisional and provisional Taxpayers|
|eFiling or electronic filing at a SARS Branch||31 October 2018||Non-provisional taxpayers|
|eFiling||31 January 2019||Provisional taxpayers|
(Adapted from a SARS table)
Overall, the situation should improve for both taxpayers and SARS.
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)