27four Investment Managers
18th June 2019
The importance of filing your tax return
Tax filing season starts for all taxpayers on August 1, 2019. Those registered for eFiling can file returns from July 1, 2019. Taxpayers earning less than R500 000 per annum from one employer in a single tax year are not required by SARS to file their tax returns.
Commissioner of the revenue service Edward Kieswetter announced that the tax return threshold was lifted from R350 000 to R500 000. The taxpayer should also have no other form of income, such as a car allowance, business income, rental income, taxable interest or income from another job. The exemption also applies if taxpayers do not have tax-related deductions to claim such as medical expenses, retirement annuity contributions and travel expenses.
It is especially important for someone who was not employed for part of the tax year to file a return. This is because employees are taxed on an annualised basis through ‘Pay As You Earn’ (PAYE). This could be a good thing in that it lessens the administrative burden on both taxpayers and SARS. Taxpayers need to make sure that they do not miss out on getting a tax refund. You can only get a refund if you file a return.
Kieswetter’s announcement does not reduce anyone’s tax obligations. The notice does not apply to expatriates working outside SA. Having an unbroken filing record leaves SARS officials with no reason to suspect that you are hiding information from them. Filing a tax return means you are being a good citizen and contributing towards society! We advise you to take great care here, and understand your duties properly, because if you don’t, you may suffer for it later on.
Remember that you can contribute up to R33,000 a year and pay no tax on interest, dividends and capital gains tax if you save it in a tax-free savings account.