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There is no need to fear filing tax returns

Tax filing season opens on Sunday and you may be wondering whether you need to bother with the often-dreaded task of filing a tax return.

Tertius Troost, a senior tax consultant at Mazars South Africa, says as an individual, you need not submit a tax return if your gross income in the past tax year consisted solely of one or more of the following:

Remuneration from one employer, which did not exceed R350000, and that remuneration did not include a car allowance or a company car fringe benefit.

Amounts paid out from a tax-free investment.

Local interest not exceeding R23800 if you are below the age of 65, or R34500 if you are 65 or older. Remember to ignore interest from a tax-free savings account.

Even if you earn less than R350000 a year, you will need to submit a tax return if you need to claim travel expenses against a car allowance or if you have medical expenses not recovered from a medical scheme or retirement annuity contributions that you need to claim as a deduction against your income.

Marc Sevitz, director of TaxTim which provides tax practitioner services online, says last year the South African Revenue Service made a significant adjustment to the medical section of the tax return, but this year there were only minor changes relating to foreign income earned and the addition of some new source codes.

The biggest change for the 2018 tax season has been the shortening of the filing period by three weeks. In past years SARS allowed taxpayers - other than provisional taxpayers - from July 1 to the last Friday in November to file their tax return.

For the 2018 tax filing season, the new deadline is October 31. The SARS says the earlier deadline will allow it more time to process refunds and handle verifications and audits before the start of the December holiday season.

SARS has many checks in place and makes use of a sophisticated verification process to ensure that what is reflected in the tax return is correct. Therefore, Troost says, to avoid additional taxes, penalties and interest, you should ensure that all the information that you submit is accurate.

Depending on your income, you should have the following documents to prove your income and deductions to SARS:

IRP5 Certificate - For your salary, any commission or contracting income you received;

IT3(a) certificate - For the investment income you received, eg dividends, interest, etc;

IT3(b) certificate - For any capital gains you made on investments;

IT3(s) certificate - For your tax-free investments;

Retirement annuity contribution certificates;

Section 18A donations certificates for donations you made;

Medical scheme contribution certificates;

A logbook, which should contain accurate travel records of business and private travel if you received a travel allowance or made use of a company car;

Copies of all invoices of legitimate expenses incurred in the production of income; and

Copies of medical invoices.

Gathering the documents you need and filling in a tax return might seem like a daunting task, but if you master the online SARS eFiling platform, it will make your life simpler.

If you e-file you can avoid the long queues at a SARS office. Also, before you submit, you can work out what tax you owe or are owed on SARS's tax calculator. If SARS decides to audit you or asks for verification, it is easy to respond.

Keith Engel, the chief executive officer of the South African Institute of Tax Professionals, warns that SARS will view excessively high claims against travel allowances, for medical expenses and deductible donations with suspicion.

SARS's eFiling system will also pick-up your eFiling profile if you repeatedly adjust certain parts of the return in order to improve your tax refund or tax payable.

However, there is no need to fear the tax season. "If you provide accurate information you will come out on the other side unscathed," Troost says.

Tax Filing Season Deadlines

If you file a paper return: 22 September 2017

If you are a not a provisional taxpayer and eFile or file electronically at a SARS branch: 31 October 2018

If you are a provisional taxpayer and eFile or file electronically at a SARS branch: 31 January 2019

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