The deadline for submitting your income tax return is the end of this month. Here are some tips, courtesy of the South African Revenue Service (SARS) for completing your return. These tips are based on common mistakes made and questions asked by you, the taxpayer.
Your income tax return makes provision for you to declare income earned for the tax year on page two of the return. This section must be completed with the information contained in your IRP5 and/or any IT3a certificates from commercial banks or financial services providers.
SARS receives many enquiries from taxpayers regarding their IRP5 certificates - this document is issued by your employer and not by SARS. It records what your employer paid you during the past tax year.
If you do not complete the section dealing with income earned, your return will be sent back to you and it will delay the finalisation of your income tax assessment.
In the past, taxpayers sent in their IRP5s and expected SARS to fill in the income section for them. SARS no longer requires your supporting documents, including your IRP5. You must use the information on the IRP5 to fill in the form and keep this document and any others that support the information you have declared for five years after submitting your return.
SARS will verify all the information you provide in your return with the information it receives from employers, financial institutions and other sources.
You must declare all the income you have earned. In particular, don't omit any rental income and investment income or you could face punitive action from SARS in future.
You should be aware that your income tax return is a legal declaration to SARS. It is vital that the information declared in the return is accurate and factually correct.
The medical deductions section is also found on page two of the return.
If the number of dependants you have registered on your medical scheme has changed during the financial year, you will need to indicate the number of dependants for each of the months starting with March (M) through to February (F) - the tax year for individuals.
Failing to include this information will delay the return's finalisation as SARS will send the form back to you for completion.
Do not forget to sign your return. SARS will send unsigned returns back to you. A form that is returned to you and resubmitted after October 31 will be considered late and you may be subjected to penalties and interest.