Picture: ISTOCK
Picture: ISTOCK

Friday, November 25 is the last day for taxpayers with no additional income but their salaries to file their annual tax returns.

More than 5.3-million have already filed, which includes returns for prior years.

Taxpayers who fail to file on time or who do not file at all will be subjected to fines that escalate with each month that they are late.

The penalty regime — introduced three years ago — has jolted taxpayers into action and the number of returns filed late has been falling since its introduction.

Those who do not have to file a return are people who earned less than R350,000 for the 2015-16 tax year, provided they have only one employer, have no car allowance, and are not claiming tax-related deductions such as medical expenses, retirement annuity contributions or travel expenses.

People younger than 65 years, whose interest income does not exceed R23,800, do not have to file a return. The interest threshold if they are older than 65 years is below R34,500.

The South African Revenue Service (SARS) reminds taxpayers, however, that if they have two employers or extra income sources such as exam markings, rental or some kind of moonlighting, they need to file even if the total income is still under R350,000.

More and more people are making use of the electronic filing system (e-filing) to submit their annual returns. This year more than half of the submissions were done through e-filing.

Of the total submissions 0.01% made use of the postal service.

Keith Engel, CEO of the South African Institute of Tax Professionals, says the basic e-filing system is one of the important accomplishments of SARS.

"It is quick and efficient. However, taxpayers must take note that they must have their supporting documentation ready which was used as the basis for completing their returns."

He says SARS is increasingly asking for backup verification, which must be submitted fairly quickly once the request is made.

"Failure to provide this follow-up information could be costly. If the taxpayer fails to act within 30 days, SARS often tries to deny the deduction, thereby increasing the tax assessment," says Engel.

Documentation that may be required to support a submission includes a tax certificate from an employer or pension fund, tax certificates for investment income, certificates and receipts for medical aid contributions, and certificates for retirement annuity contributions.

The documentation must be kept for five years but has to be submitted to SARS only on request.

Provisional taxpayers have until the last day of January next year to submit their returns through e-filing.

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