Simple guide to tax season — and who needs to register and file a return

2010-07-21 00:00

INCOME tax is something that affects nearly every South African who is formally employed. Every person earning above R57 000 a year has to pay income tax.

Understanding the rules can be difficult because the application of the rules changes with a person’s circumstances. Here are some of the most common questions people ask about income tax.

What is the tax year?

The South African tax year runs from March 1 to the end of February the following year.

Who must register as a taxpayer?

Every person in South Africa who is employed needs to register as a taxpayer with the SA Revenue Service (SARS) as of the 2011 tax year. Every South African employee must be registered with SARS by the end of August 2010.

How do you register as a taxpayer?

If you work for one of the larger companies in South Africa, the company will be able to register you as a taxpayer. If your employer does not use the SARS electronic filing system, you will need to register yourself. You will need to go to a SARS branch with the following documents to register:

• A certified copy of your ID;

• original bank account details;

• IRP5 tax certificates (for the past three years if available); and

• proof of your residential/postal address.

Who does not need to file a tax return?

You do not need to submit a tax return if ALL of the following apply to you:

• You earn less than R120 000 a year.

• Your employer pays your retirement annuity and medical aid, or you don’t have a retirement annuity or medical aid.

• You had no major medical expenses during the year, other than your normal medical aid contributions.

Who needs to file a tax return?

You must file a tax return if ANY of the following apply to you:

• You earn more R120 000 a year.

• You worked for more than one employer during the tax year.

• You are paying your own retirement annuity and medical aid, or incurred major medical costs during the tax year.

What are ‘rebates’?

A “rebate” is a “discount” that automatically gets deducted from your tax liability.

*Johan Swart is tax manager at Legal & Tax.

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