Do you need to pay tax? Sometimes, no. SARS has recently communicated that if you earn less than R350,000 in a year, and fulfil a series of complicated criteria, you may not have to file a tax return in 2016.
If you earned under R350 000 before tax in a full year from one employer and have not made additional income from things like freelance jobs, interest or rental income and no deductions that you want to claim (for example medical expenses, travel or retirement annuities), then you don’t need to submit a tax return.
So you don’t have to, but there are also some reasons why you still should.
Here are the top 5 reasons why not to skip filing your tax return this season:
Why let SARS keep your money if you are due a refund? A refund is money you overpaid on your taxes and it belongs to you. You can only get a refund if you file a return. Something as simple as claiming Medical expenses or working two jobs can trigger a tax refund, depending on your situation. See our refund calculator.
If you wish to borrow money in the form of a mortgage for a home, or a long term loan of any kind in future, you will need a Tax Clearance Certificate. This can only be obtained if all your returns are up to date and filed appropriately.
3. SARS might change their mind.
If you normally submit, but this year you don’t, SARS may administer administrative penalties later on down the line for not being compliant.
Filing a tax return each and every year means that should you receive a payout from a fund at any stage, then you will not have any hassle in getting the money. If you retire or are retrenched, or just need to take money out of your fund early, you need to be tax compliant.
Having an unbroken filing record leaves SARS officials with no reason to suspect that you are hiding information from them, thus triggering an audit next year. Filing a tax return means you are being a good citizen and contributing towards society!