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Sars cuts tax deadline

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“The quiet period after the first three months of tax season has now been removed resulting in efficient use of our resources.”

SARS cuts down tax returns deadline File photo: INLSA

THE SOUTH African Revenue Service (Sars) has announced a shorter tax season.

Acting commissioner of Sars, Mark Kingon, said yesterday that the 2018 tax season would be shortened by three weeks and would now run from July 1 to October 31, 2018,

This impacts all individual non-provisional taxpayers and also applies to provisional taxpayers who opt to file at a branch.

Provisional taxpayers who use eFiling have until January 31, 2019 to file, while the deadline for manual submissions is September 21.

The rationale for the shorter season, according to Kingon, is that it will allow additional time for Sars, as well as taxpayers, to deal with return verifications before most taxpayers go on their December holiday break.

“Often there are delays with taxpayers having to respond to our queries and requests over the holiday break,” Kingon said at a media briefing yesterday.

“The quiet period after the first three months of tax season has now been removed resulting in efficient use of our resources.”

Kingon added that too many people who were not required to file, due to them earning a single source of income from one employer of up to R350 000, were going into a Sars branch.

“During the 2016 tax season, 1.8 million people who did not need to submit a tax return did so, while in the 2017 tax season this number was 1.6 million people.”

He pointed out further that a large number of returns were being filed for prior years.

“A total of one million outstanding returns for prior years was submitted during the 2016 tax season and in the 2017 tax season, 733 000 returns were submitted for prior years. While taxpayers’ desire to bring their tax affairs up to date is welcomed, this makes processing returns for the current year of assessment more challenging. We would like to move towards clearing the backlog and encourage taxpayers to file their returns on time.”

A number of registered eFilers are also filing at Sars branches, which, Kingon pointed out was not necessary.

“In 2016, a total of 935 269 registered eFilers who were able to eFile used branches to file, while in 2017, a total of 868 562 registered eFilers did so.”

Tax practitioners, whose primary filing channel is eFiling, are also using branches to file taxpayers’ returns while some prospective employers and employment agencies request job seekers to first register for a taxpayer reference number before they can be employed. This results in an unnecessary inflow of traffic at Sars branches.

“A job seeker does not need to visit us to obtain a taxpayer reference number. We provide employers with [email protected] – a simple eFiling platform tailored for the employer’s needs, which they can use to register employees for income tax,” Kingon pointed out.

Currently, approximately 65% of all individual non-provisional taxpayer returns are filed in the first three months of the tax season after which submissions decline, followed by a spike again towards the end of tax season.

“Our main objective is to make tax compliance a simple and routine experience for the taxpayer.”

Kingon added that Sars had sent personalised and direct communication to taxpayers who may not have to submit a return, based on information submitted during tax season 2017, setting out their specific tax obligations.

“A taxpayer does not need to submit a return if all the following criteria apply: the taxpayer’s total employment income/salary for the year of assessment (March 2017 to February 2018) before tax was no more than R350 000; employment income/salary for the year of assessment was received from one employer; the taxpayer has no other form of income (e.g. car allowance, company car fringe benefit, business income, taxable interest or rental income or income from another job) and the taxpayer does not want to claim for any additional allowable tax related deductions or rebates (e.g. medical expenses, retirement annuity contributions, travel expenses, etc.).

Sars will also ensure that verification letters will be more specific in terms of the supporting documents required from taxpayers who may have been flagged for a specific risk.

Taxpayers will be encouraged to file via eFiling on their own,while tax returns for the current year of assessment will take priority over outstanding returns filed for prior years.

“Unfortunately, experience has shown that the submission of prior year returns poses a risk to taxpayers that are taken in by scammers and other tax fraud that we have detected,” Kingon pointed out.

Sars has meanwhile increased the testing phases of its systems to ensure smooth running when Tax Season opens on July 1.