Most of 2020 has been quite a blur for many South Africans, and let’s face it – we’ve been dealing with a lot lately. Yes, it’s that time of year where you scramble to get all your administrative ducks in a row with the hopes of filing your tax returns with as little back-and-forth as possible. Then there is the ongoing COVID-19 outbreak, which is likely to add another layer of stress to the situation. Luckily, the South African Revenue Services (SARS) have put a plan in place to streamline the process; in fact, they will be doing all the work for you! What’s more, if you have LAW FOR ALL in your corner, filing your tax return in 2020 will be a breeze.
The four phases of the 2020 tax season:
Like most institutions, SARS has had to rethink how it would go about facilitating its busiest time of the year while a highly infectious virus still rears its ugly head in South Africa. “During this critical moment, SARS has embarked on the journey to reimagine how to provide an efficient and effective service to all our taxpayers while improving compliance levels. These trying times have imposed the challenge on the organisation of providing a seamless and effortless service to taxpayers while protecting our own employees and taxpayers from infection,” asserted SARS in a statement. The plan looks a little like this:
The initial stage was reserved for employers and third-party providers (such as medical aid companies, banks and retirement annuity schemes) to submit all the necessary info and certificates before 31 May 2020. SARS maintains that most companies complied, but there were a few that didn’t meet the deadline. This could cause a headache for some taxpayers down the line.
So, in an attempt to minimise potential problems for taxpayers as much as possible, SARS initiated a second phase, aimed at not only validating all the info they have received from the third-party providers but also to follow up on all those who did not meet the 31 May 2020 deadline.
Legal sidenote: it’s a criminal offence for companies not to deduct PAYE from employees.
Phase 3: (Individual Taxpayers, take note!)
During the first few days of August, taxpayers can expect to receive an SMS informing them that they have been selected for an “auto-assessment”. What this text means is that SARS has prepared a tax return for you. What’s more, it will inform you that a draft assessment is available on your eFiling profile or Mobiapp platform for you to go over to ensure it’s complete and accurate. This is called an “auto-assessment”.
What is a SARS income tax auto-assessment?
This tax season, SARS has decided to do most of the admin related to prepare or file your tax return in 2020 for you, which is excellent news! Essentially, this means that SARS has taken all the info sent to them by your employer and any other third-party provider (assuming it was sent to them during Phase 1 or 2) and done all the legwork. The SMS you receive on 1 August 2020 is an instruction for you to log onto your eFiling profile and check that the auto-assessment is correct. You can then choose to accept or reject the assessment. If you do agree, your return will be filed, and any under or overpayment of tax will be processed as in prior years. In terms of the refund, if one is due, SARS has stated that it will be paid in the first week of August 2020. What’s more, if your third-party data is submitted during August, SARS is expected to invite you to file early.
Take note: If you take no action regarding your auto-assessment by 29 January 2021, SARS will assume you’ve accepted their findings and will file your return automatically. This is called a default assessment.
What if I haven’t been selected for a SARS auto-assessment?
This is where Phase 4 comes in. Starting on 1 September 2020, this stage of the 2020 tax filing season is reserved for those taxpayers who have not been selected for an auto-assessment or who have rejected the one they received initially. This period will give you time to dispute the SARS assessment and, if necessary, make an appointment to visit your nearest SARS branch. Of course, SARS still encourages taxpayers to take advantage of their digital platforms: “ During the time when our country is still battling the scourge of COVID-19, we hope taxpayers will take advantage of these innovations aimed at making it easier and faster for taxpayers to comply with their tax obligations,” said Edward Kieswetter, Commissioner of South African Revenue Service, in a media statement.
What happens if I don’t have a digital tax profile?
Taxpayers who do not have an eFiling profile or access to the MobiApp will be allowed to visit their nearest SARS branch; of course, to help comply with health and safety regulations, this is only possible via an appointment.
Important dates of the 2020 tax season for those who haven’t been selected for an auto-assessment:
- 1 September – 16 November: during this period, taxpayers who were not auto-assessed can file via eFiling or the MobiApp.
- 1 September – 22 October: Anyone who doesn’t have an online tax profile and who must file at a SARS branch can make an online booking to visit the brand during this period.
- 1 September – 29 January 2021: Provisional taxpayers can file via eFiling.
How LAW FOR ALL can help with your tax returns:
At LAW FOR ALL, we understand that filing your tax return in 2020 can be a stressful time, and we also know that anxieties may be at an all-time high due to the impact of the pandemic. That’s why our Platinum policyholders can receive clear and thorough tax advice and guidance, and our Platinum Plus members can rely on us to file their returns for them!
With regards to the auto-assessments, LAW FOR ALL will check if all the info and calculations are accurate before clicking “Accept”. Additionally, Policyholders who do not receive auto-assessments (for instance, those who want to claim travel allowance or rental income) can also turn to LAW FOR ALL, and those submissions will be processed on their behalf starting on 1 September 2020.
What’s more, be sure to check out our guide on How to Make the Most of Your 2020 Tax Return.
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LAW FOR ALL can help you with more than your tax returns! Be sure to have a look at LAW FOR ALL’s comprehensive policies. Sign up today!