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Tax Filing Season for individuals opens on the 1st July, what do I need to prepare?

For many of our clients, tax filing season is associated with feelings of apprehension and confusion. Most of us only do this once a year, and it can be quite bewildering and daunting to figure out exactly what we need to have on hand to submit our tax returns correctly.

With SARS announcing that tax filing season for individuals will run from 1st July until 23rd November this year, it is time to start preparing the information and documents needed to submit our tax returns.

Remember that taxable income can come from many sources, and it is important to declare all income on your tax return. We have listed some items below that you need to consider when preparing your documents.

  • If you earn income from an employer, pension fund or living annuity, you will need a copy of your IRP5 certificate, which will break down the income you have received and PAYE deducted from your income and paid over to SARS on your behalf. If you have not received this already, you can request it from your employer or your retirement fund administrator.
  • Are you claiming a travel allowance? If so you will need a logbook detailing your business mileage for the year as well as your opening and closing mileage readings for the period 1st March 2020 to 28th February 2021. SARS has a template for this available on their website (2020-21-SARS-eLogbook.pdf), alternatively you can create one fairly easily using excel.
  • Are you earning rental income? If you are then you will need to prepare a schedule detailing all the income and expenses relating to the rental property. Be sure to have your proof of expenses easily accessible should SARS request them.
  • Do you have any bank accounts, both local and offshore that earn interest? If so, you will need an IT3(b) for each account detailing the amount of interest you earned during the year. The good news is that most banks allow you to download this using online banking.
  • If you have an investment such as a Unit Trust or Share Portfolio, you will likely have earned some taxable income from this. This income could be in the form of interest and dividends or in the form of a Capital Gain if you made any withdrawals from the investment. You will need a copy of both the IT3(b) and IT3(c ) certificates which detail this income.
  • Have you made use of a Tax-Free Savings Account? If so you will need a copy of the IT3(s) certificate from the provider detailing your contributions, withdrawals and profit or loss made on the investment.
  • Are you the main member of a medical aid? If so, you will need your medical aid tax certificate showing your contributions for the year, the number of members on the medical aid, and any expenses that were not paid by the medical aid. This can normally be requested off your medical aid’s online portal or using the self-help menu options if you prefer to request it telephonically. In addition to your medical aid tax certificate, if you had any qualifying medical expenses that you paid and did not submit to the medical aid, you will need a schedule of these, as well as the invoices and proof of payments should SARS requests them.
  • If you have made contributions towards a Retirement Annuity, you will need a copy of the contribution certificate from the provider.
  • Have you made any donations to registered Public Benefit Organizations (PBOs)? Should you have you will need to request a copy of the Section 18A receipt from the organisation to claim your tax deduction.
  • Take special care to mention to your tax consultant if you have sold any properties in the year under review.
  • Importantly, make sure that all your personal registered details are correct on e-filing and at SARS, especially your ID number.
  • If you are considering a work from home expense claim, there are specific requirements around this. Please refer to our previous article for more details.

Please remember that although most of this information should automatically pull through to your e-filing profile, you will need to have the hard copies available to submit to SARS if you are selected for a SARS verification.

As everyone’s tax return is unique and tax legislation is complex, this article is for information purposes only and is not to be construed as tax advice, nor does it take into account your specific financial circumstances. We encourage you to speak to a tax specialist from Chartered Tax for more guidance as we believe professional specialists can add great value in helping you to keep your tax affairs up to date and in order.