As South Africans prepare to enter the second week of the Level 4 lockdown, the way we lead our lives has changed in more ways than one. One aspect of our lives changing is the way we will be doing taxes.
During a presentation on May 5, SARS Commissioner Edward Kieswetter outlined the necessary changes we will be facing in the coming tax filing season. This due to the impact of COVID-19.
According to Kieswetter, the season will comprise of three phases. Each will have a number of key changes made, while highlighting what is expected of taxpayers and companies over each period.
Phase 1 – Employer Filing
April 15 to May 31
Kieswetter says during this time, compliance by employers in respect of payroll taxes (PAYE) is of the utmost importance. There will be a renewed focus at SARS to ensure all employers are fully compliant in terms of their filing and payment obligations.
“We expect all employers to fully comply, because this ensures a much lower burden of compliance for their employees in respect of their filing obligations.”
Furthermore, Kieswetter explains employers, are legally appointed agents on behalf of SARS, reminds employers that it is a criminal offense to collect income tax from their employees, and not pay this over to SARS.
“We also appeal to employers, along with other providers of third party information to fulfil this requirement by the end of May 2020,” Kieswetter adds.
Third-Party Information allows SARS to use data modelling and artificial intelligence to perform the final assessment of all standard taxpayers. This provides the majority of individual taxpayers with a seamless filing experience.
Third Party Providers include:
1. Employers
2. Banks
3. Financial Service Companies who administer retirement fund and pension schemes
4. Medical Savings and insurance schemes
Phase 2 – Tax File Updates
June 1 to August 31
During this period taxpayers are requested to engage with SARS to ensure that their tax files are up to date.
In terms of general hygiene checks, banking details, address changes and so forth, SARS online facilities are available to do most of this. These checks will now be done mainly online before Filing Season.
According to Kieswetter, all outstanding third-party information will also be followed up during this period. This will be to ensure the highest level of data integrity.
“Third-party data providers, including employers, who remain wilfully non-compliant will be charged criminally during this period,” Kieswetter emphasises.
Furthermore, during this phase, a significant number of taxpayers will receive auto-assessments. They will be given an opportunity to confirm their acceptance of the assessment outcome according to SARS.
During Phase 2, individual taxpayers who are required to file but have not been auto assessed may file early via on-line facilities if their employers and other third-party data providers are fully complaint.
Individuals who are not required to file will be informed.
Phase 3 – Employee Filing
September 1 to January 31, 2021
During this period, Kieswetter says individuals who are required to file, will be reminded.
“Individuals who are non-provisional taxpayers or have not accepted the outcome of an auto-assessment, are required to file as from 1 September through to 16 November and encouraged to file using our on-line channels to minimise visits to our offices,” he explains.
Individuals who are non-provisional taxpayers, who make use of the SARS Branch facility have until October 22 to file.
Furthermore, Kieswetter says Provisional Taxpayers who have not accepted the outcome of an auto-assessment, are required to file when they are ready. But this is not to be done later than 31 January 2021.
During this period, it remains important for all taxpayers to remain compliant.
This means it is important to register when they are legally required to. Also, it means submitting tax and customs declarations, returns, and relevant submissions when it is required.
It also means making the necessary payments when they become due. This is unless they have entered into a permissible payment arrangement with SARS.
Be sure to do your part and abide to implemented regulations.
