SARS has advised that if your earnings for the tax year were below the R350 000 threshold, you do not need to file income tax returns. This is provided you meet the various requirements, such as the earnings coming from one employer and that you have not received additional income from rent, royalties, or interest. If you want to claim for medical expenses, you still have to file your income tax returns.
The above said, even if you fall in the category of not having to file income tax returns, you must ensure that you understand your obligations and responsibilities, so as to avoid penalties later on. Below are reasons why you should not miss filing your income tax returns this season.
Risking an incomplete filing record
Having an incomplete filing record can set off alarm bells at SARS, triggering an audit next filing season, even though you do not have anything to hide.
Not being able to get a refund
If you have overpaid on your taxes, then SARS owes you a refund. You can only get it if you submit your income tax return. You may have worked two jobs in order to make ends meet and can thus, depending on the particular situation, claim a refund. However, if you do not submit the income tax returns, you miss any opportunity to get the refund you deserve.
Not getting a tax clearance certificate
Do you want to get a second bond on your home or perhaps a long-term loan? You will need a tax clearance certificate to do so. If you do not submit your returns, you will not be able to get it. The certificate is only issued if all your returns have been submitted.
Risking administrative penalties
If you usually submit your income tax returns and, based on the information provided by SARS, decide not to do so this season, you risk having to pay administrative penalties later on. SARS might decide in future that you have missed submission or request an audit because you have not filed for one season.
Risk limiting access to a retirement payout
In order to get a payout from your retirement fund, you must be 100% tax compliant, which means that all your returns must have been filed. If you decide not to do so this year, you risk having to explain the reasons for such, should you need access to your retirement fund next year.
Avoid the above risks by getting expert guidance on the submission of income tax returns. Make use of our consultancy and filing assistance.
Disclaimer: This article is for information purposes only and does not constitute legal, tax, or financial advice. Call on us for professional legal advice, rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing – August 2018.