Who should file tax returns?
Each year South Africans that earned income are required to report earnings to the receiver of revenue.
In South Africa, individuals who earn income are generally required to file a tax return with the South African Revenue Service (SARS). However, it can be confusing to determine who is exempt from this requirement, leading to potential penalties for non-compliance. Here are some key scenarios in which filing a tax return is mandatory:
- Trade Income: Individuals earning income from a trade, such as sole traders, partners in a partnership, trusts, or company owners.
- Rental and Investment Income: Those earning income from rental properties or taxable investments.
- Multiple Income Sources: Individuals with income from more than one source, including those who switch employers.
- Allowances: Individuals receiving allowances such as travel, company car, or subsistence allowances.
- High Income: Individuals with an annual income exceeding R500,000.
- Foreign Income: Individuals earning income from foreign sources.
Note: This list is not exhaustive. If you meet any of the above criteria, you are required to file an annual return by the deadline.
At FMJ Tax Consulting, we help handle your SARS audits and specialize in assisting clients with any tax-related queries.
How FMJ Tax Consulting Can Help
At FMJ Tax Consulting, we specialize in assisting clients who must file annual returns. Our services include:
- Prompt feedback once we receive all your tax documents.
- Proof of submission sent upon account payment.
- Handling SARS queries and keeping you informed until resolution
Contact us today to ensure your tax return is filed accurately and on time!
By when should my returns be filed?
Each year, SARS announces specific deadlines for filing tax returns, which vary based on whether you are a provisional or non-provisional taxpayer.
- Provisional Taxpayers: Those earning additional income exceeding R30,000, such as investment income or income without tax deductions by an employer.
- Non-Provisional Taxpayers: Generally subject to an earlier deadline, typically around October each year. Provisional taxpayers have a deadline around the end of January the following year.
Understanding your taxpayer status is crucial to avoid penalties or dispute incorrect penalties imposed by SARS.
How FMJ Tax Consulting Can Help
We track your status and send reminders to help you file your return before the deadline.
Stay compliant with FMJ Tax Consulting’s proactive tax management services.
Auto or Estimated Assessments
SARS may issue an auto or estimated assessment without your intervention. It is the taxpayer’s responsibility to review and correct any errors within the specified time frame. Failure to do so may result in SARS finalizing the assessment and reserving the right to investigate for up to 5 years if fraud or income misstatement is suspected.
How FMJ Tax Consulting Can Help
For a non-refundable deposit, we will review the SARS assessment to determine its accuracy. If corrections are needed, we will provide a quote and estimated results. We keep our clients on a follow-up list to ensure ongoing compliance.
Let FMJ Tax Consulting handle your SARS assessments and corrections for peace of mind.
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FMJ Financial Services are registered tax practitioners specializing exclusively in individuals. This means that we remain focused and are not sidetracked by additional services like bookkeeping, payroll management, or preparing annual financial statements. This allows us to focus on handling more complex tax cases, delivering exceptional service, prioritizing record retention, and developing systems that ensure consistent client feedback, efficient audit management, timely follow-ups. We also track SARS turnaround times and when SARS exceeds their agreed turnaround times, we follow the internal SARS processes and escalate to the tax Ombud where appropriate. This enables us to operate a sustainable business within our field of expertise.
What makes us different?
Leveraging over 15 years of expertise in the tax industry, we have cultivated an in-depth knowledge of client’s needs, alongside comprehensive familiarity with SARS systems and procedures, tax legislation, administrative laws, and other related regulations, which forms part of achieving success in the industry. As a result of this and our meticulous approach, we guide between 600 and 700 individuals through the system annually.
Our business operates professionally, ensuring we maintain our clients’ records and are prepared to handle any audits, including those initiated by SARS for previous years, for which we have compiled the returns.
Our isn’t simply completing a return. Our expertise encompasses a thorough knowledge of tax laws, effective case presentation to SARS, industry best practices, and key guidelines to follow. In addition, during our quieter months, we focus on preparing our existing clients’ cases to ensure readiness when the season begins. We diligently reach out to all our clients who collaborated with us during the quieter months and then proceed to assist the rest of our clients.
Our goal is to meet every deadline for returns, provided the taxpayer supplies us with the necessary documents and information in a timely manner to ensure the submission is accurate and defendable. With the brief duration of tax seasons, thorough preparation for the initial phase is crucial to our success.
Am I liable to file income tax returns (Tax year 2025 and/or tax year 2026)?
If you answer ‘yes’ to any of the following questions, ensure you file your income tax return before the deadline.
- Have you earned any income from trade? This includes generating income from any business activity, whether as a sole trader, a partner in a partnership, a shareholder, or a company director.
- Did you earn any money from renting out property? This includes income from renting out houses or commercial buildings, as well as earnings from leasing other assets like machinery.
- Earnings from multiple income sources? Individuals with income from more than one source, including those who switch employers.
- Have you received any allowances? Individuals who get allowances like travel allowances, company cars, subsistence allowances, etc. Anyone who receives any such allowance must file a tax return, even if their income is below R500,000.
- Earnings above R500 000? Individuals who earn more than R500,000 a year. Please remember to refer to gross income as defined, not just your salary. If your employer pays for things like medical aid contributions, this amount is counted as part of your gross income. Other extra benefits should also be included, like any insurance the employer pays for, funeral plans, free or discounted services, computer allowances, and more.
- Have you received any income from abroad? Tax residents who earn income from other countries.
- Any extra earnings? For instance: income received from a trust, proceeds from selling capital assets such as a primary residence or non-primary residence, the sale of shares, income from investments, and more.
- Any provisional taxpayer. A taxpayer must file a return, even if their status changed during the current year. SARS will automatically change the taxpayer’s status to non-provisional if they no longer qualify as a provisional taxpayer.
- At FMJ Financial Services, you can rely on an experienced and efficient tax professional who specializes in assisting individuals with their annual tax filings.
Note: This is not a comprehensive list. You must file an annual return by the deadline if you satisfy any of the aforementioned criteria.
The services we offer include:
- Timely feedback upon receiving all your tax documents and information.
- Confirmation of submission and the outcome. We’ll take care of you if there are any audits. If SARS disagrees with the assessment, we will automatically file an objection, as long as a full declaration was given to us and there are valid legal reasons for the dispute.
- Managing SARS inquiries and providing updates until resolved.
- Tracking SARS turnaround times and addressing delays according to the rules outlined in the Tax Administration Act.
Consequences of Failing to File a Return
Failure to file a tax return can lead to severe consequences, including:
- SARS Assessments: Under Section 95 of the Tax Administration Act, SARS may issue an assessment that becomes final if not addressed within 40 business days. This assessment could include linking to your bank account and assessing all credits as income.
- Administrative Penalties: Monthly penalties ranging from R250 to R16,000, depending on income, until the return is filed or for up to 35 months.
How FMJ Tax Consulting Can Help
We proactively reach out to our clients to ensure timely and accurate tax return filings. For complex cases, we start preparations early to expedite final approval and submission when the tax season opens.
Avoid penalties by partnering with FMJ Tax Consulting for your tax filing needs.
Frequently Asked Questions
If you are an individual and earn a salary or commission or if you charge fees for work done, you have to register for tax payment. If you earn less than the minimum threshold amount set by SARS for the particular assessment year from a single employer, then you will not need to submit a return. If however, you earn less than the threshold from a single employer, but have additional income such as earnings from rental or you want to claim medical expenses, then you will have to submit a return. If you are still not sure whether you are supposed to submit a return, contact us for assistance.
If you are a resident in South Africa, you have to pay tax on your earnings from anywhere in the world. Note that there are certain exclusions, best discussed with a professional consultant from FMJ Financial Services. If you are not a South African resident, then you will only pay tax on the income derived from a South African source.
To be a South African resident, you must have been present in the country for more than 91 days in aggregate for the specific tax assessment year; for more than 91 days in aggregate for each of the preceding five tax assessment years and for more than 915 days in aggregate for the five years before.
In its simplest form the rebate, sometimes referred to as tax refund, is a refund given by SARS to the taxpayer when the tax liability or amount that has to be paid is less than the actual amount paid by the taxpayer.
It is the year for which the taxpayer is assessed covering a period of 12 months. This assessment year starts at the 1st of March and ends on the 28th or 29th of February the following year. Note that the year of assessment for a company or CC refers to the entity’s financial year.
SARS allows for provisional tax payment, where the taxpayer makes two tax payments during the year of assessment and where the final tax liability is only determined upon the final assessment. The provisional tax payments are made at the end of the assessment period and six months after the assessment year started. The taxpayer completes an IRP6 form and submits it to SARS. A third payment can be made if the tax owed is more than the estimated amount payable.
It is important to note that, for each of the deductions listed below, specific terms and conditions apply, best discussed with a professional consultant to ensure that you do not make a deduction which is not allowed.
- Donations
- Pension fund contributions
- Retirement annuity fund contributions
- Travel expenses
- Medical aid contributions and expenses
- Home study expenses
Yes, you can and do not need to make use of a professional consultant. You can also ask a SARS consultant for assistance. However, the benefits of making use of professional tax consultants such as FMJ Financial Services are:
- Timely and accurate tax return completion and submission.
- Accurate calculations which will help avoid penalty situations.
- Structuring assistance to prevent you from overpaying.
- Full compliance with statutory regulations.
- Tax advice on commercial transactions
- Ensure a professional qualified tax practitioner deals with any audits and handles objections in a timely fashion where necessary. (SARS requires objections within a period of 30 days and currently have draft rules which will change the objections and appeal rules.
Our professional consultants understand that each individual and small company’s situation is different. It is thus imperative to provide personalised assistance and we start with an assessment based on your particular tax profile. Contact us today.
Our services do not extend to CIPC-registered entities (CC, (Pty) Ltd), except in cases where an existing client possesses a dormant company requiring the submission of a business income tax return. In such cases, we would only do such work as a by-product to maintain the client’s compliance profile.
FMJ will, however, collaborate with sole proprietors who are not registered for VAT.