Filing season officially opened on 1 July 2021. Below are a few important things to keep in mind when doing your taxes.
First and foremost, you HAVE to do it. There is no more slipping between the cracks at SARS. We strongly recommend that anyone who may still be tempted not to file a return or to withhold any important information, reconsiders. Earlier this year we wrote about some important changes to legislation that now make it a criminal offence not to submit a comprehensive, correctly completed return. If you missed the article, you can find it here.
If you still think you may get away with not declaring that secret offshore bank account, we would also like to remind you about Common Reporting Standards, often just referred to as “CRS”. Around 97 countries in the world are collaborating via the OECD to comply to Common Reporting Standards. This means that their tax authorities share common information with each other by way of making all regulated financial institutions report certain information to them, including but not limited to:
- Personal identifying information (name, tax number in your home country, etc.)
- Account details (of the bank account/investment/shareholding/)
- The total account balance/value of your accounts calculated at the end of the calendar year, including any interest (excluding the balance of any excluded accounts)
CRS was agreed by G20 countries in 2014 and reporting started in 2017, with more countries joining the agreement on an annual basis. So, when SARS does catch up to you, don’t be surprised when they are able to backdate their investigation to your global income & assets as far as that.
Even while SARS branches are closed for physical visits until at least 16 August 2021 due to Covid, they have taken many steps to simplify filing your tax return. Around 3 million taxpayers will be auto assessed. These are usually individuals who have relatively straightforward tax affairs, with most (if not all) of their information being verified to SARS by 3rd parties like banks, investment companies, etc. These taxpayers will receive an sms advising them of their auto assessment. They can then check the assessment online or on the SARS mobi app and accept or reject the automated result.
Auto-assessments created quite a bit of chaos last year when they were first introduced, but SARS has gone to great lengths to refine the enormous amount of data they receive from third party financial institutions & employers to fine-tune this process. Having said that, we strongly recommend that you still visit the platform of your choice (eFiling/SARS mobi app) to double check the assessment and insert any information that may still be outstanding, before submitting your final return.
People who do not have access to online systems or smartphones are not left out in the cold. These individuals can now request basic information like a reminder of their tax number, a statement of account or they can even make an e-booking, via sms. Anyone who prefers to talk to a consultant, can request a call-back from SARS and unregistered individuals can use this sms system to register with SARS.
These services can be accessed by sending a free sms to 47277 as follows:
- Request and eBooking appointment
- Booking (Space) ID number/Passport number/ Asylum Seeker number
- Confirmation request to determine whether to submit a personal tax return
- File (Space) ID number/Passport number/ Asylum Seeker number
- Request the issuing of the IT150 (Tax Registration Number)
- TRN (Space) ID number/Passport number/ Asylum Seeker number
- Request Account related queries (balance statements) and/or provision of Statement of the Account (SOA)
- Balance (Space) ID number/Passport number/ Asylum Seeker number
We have observed SARS’s efficiency with a few of our clients who have already submitted their returns and are happy to report that those who were auto assessed with a refund due, received their refunds in less than 3 days in most cases, despite the official turnaround time being communicated as 7 business days. Clients that were not auto-assessed, but pro-actively submitted comprehensive returns, were also refunded (where applicable) within a matter of days.
It is too early to tell whether audits/investigations will run smoothly, but we were happy to see that the communication regarding audit requirements seems to be clearer and more concise this year. It is much easier to submit the correct information for an audit, if you actually know what they need!
Doing our tax returns is no-one’s favourite pastime and we still see room for improvement in the process, but it is definitely getting easier to be compliant. Tax season is open until 23 November 2021 for online submissions and until 31 January 2022 for provisional taxpayers (including trusts) who submit their returns via eFiling or SARS mobi. In person submissions will be allowed by appointment only, and that only once the various SARS offices open again.
Don’t wait until the last minute. Speak to your tax adviser and get your return in sooner rather than later so that you have one less thing to worry about during these worrisome times.