Some of those earning less than R500,000 a year would still have to file a tax return: Sars
The recent announcement by revenue service Sars about the earnings threshold below which tax returns do not have to be submitted has been misinterpreted, says Sars.
SowetanLIVE reported that Sars raised the threshold for taxpayers who need not file tax returns to earnings of less than R500,000 a year - but there are conditions. The previous threshold was earnings of less than R350,000 a year.
Threshold of R500k and criteria for those not required to file
Sars has clarified that the threshold of R500,000 refers to those people who are no longer required to file a tax return - it does not mean workers who earn less than R500,000 a year will no longer pay income tax.
Added to that, the "filing threshold" is not the same as the "tax threshold" to pay tax or have Pay As You Earn (PAYE) deducted.
"You have already paid income tax through the PAYE deducted from your salary if you earn more than R79,000 a year for those under 65 years for the 2020 tax year," said Sars.
Sars says those who earn above R500,000 a year are generally required to confirm what Sars already knows about their income and financial status by filing a return.
Taxpayers who earn below the filing threshold of R500,000 a year are still required to file a return in the following circumstances:
* If they have more than one source of income, such as rental income or income from another business; and
* To claim tax-related deductions such as medical expenses not covered by their medical aid, retirement annuity contributions and travel expenses.
In short, the following conditions must apply before you can safely forget about filing a tax return:
- Your remuneration is paid from one employer or one source (if you changed jobs during the tax year, or have more than one employer or income source, you must file);
- You have no car or travel allowance, or a company car fringe benefit (which are all considered as additional income);
- You do not have any other form of income, such as interest, rental income or extra money from a side business such as selling Tupperware or baked goods; and
- Employees tax (ie PAYE) has been deducted or withheld by your employer.
Tax filing dates
- E-filing opens on July 1 and closes on December 4 2019.
- Branch filing opens on August 1 and closes on October 31 2019.
- Provisional taxpayers have until January 31 2020 to file via e-filing.