Do you need to submit a tax return? A plain-English guide for South Africans

Every July the same question lands in my inbox: “SARS sent me something. Do I actually need to do anything?” Here is the answer, without the jargon.

Who must submit a return

You must submit an ITR12 if, during the tax year (1 March to the end of February), any of the following applied to you:

• You earned more than the tax threshold and had more than one employer or source of income.
• You received a travel, subsistence or other allowance, or a company car fringe benefit.
• You earned rental, freelance, business, commission or foreign income.
• You sold an asset with a capital gain or loss above R40,000.
• You hold foreign assets or funds worth more than R250,000.
• You want to claim deductions: retirement annuity contributions, medical expenses, donations, home office, or a travel logbook.
• You are a provisional taxpayer.
• SARS has asked you to. A request from SARS always wins.

Who does not need to submit

You are exempt if all of the following are true:

• Your total employment income was R500,000 or less for the year.
• It came from one employer for the full year.
• You had no allowances and no other income (interest below the exemption is fine).
• You have no deductions you want to claim beyond what your employer already processed.

Even if you are exempt, it can still pay to file. If you contributed to a retirement annuity privately, paid medical expenses out of pocket, or your employer withheld too much PAYE, you only get that money back by submitting.

What an auto-assessment means

SARS now pre-fills returns for millions of taxpayers using IRP5, medical aid, retirement and investment certificates, and sends an auto-assessment by SMS or email. If you do nothing, it becomes final after the deadline.

The problem: SARS only knows what third parties told it. An auto-assessment will not include your home-office claim, your travel logbook, donations to a PBO, out-of-pocket medical expenses, or rental income you must declare. Accepting one blindly can mean a smaller refund, or worse, an understated return that SARS later queries.

My rule: never accept an auto-assessment without checking it. It takes twenty minutes and often finds money.

The three mistakes I see every year

1. Ignoring side income. Interest, crypto gains, a few months of freelancing, Airbnb income. SARS receives third-party data on most of this and reconciles it. Declare it and claim the related expenses.
2. Missing the deadline. Administrative penalties run monthly from R250 to R16,000 depending on your income, for every month a return is outstanding. They are entirely avoidable.
3. Guessing on medical and travel. Keep your logbook and your receipts. Without them, a verification turns a refund into a bill.

When to call an accountant

If your situation is a single IRP5 and a medical aid, you can probably do this yourself in half an hour. If you have multiple income streams, a rental property, a business, foreign income, or a dispute with SARS, a Professional Tax Practitioner will almost always save you more than the fee. Book a free consultation and I will tell you honestly which camp you are in.

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This article is general information, current at the date of publication, and not advice. Tax law and SARS practice change; please confirm the position for your own circumstances or book a consultation.

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