Taxes (Beginners Intro: What you need to prep for tax seasons/ eFiling)- South Africa
Taxes! The dreaded darn thing that gets you in a tizzy every year. You know you have to file for it, but what the hell are we paying toward and what are we even doing by submitting all of this info anyway?
Some of you have got our tax games on point. Well done if you’re in this group. Others have a lot of catching up to do. Yeah you know who you are… (I was once there too!)
Taxes are a broad topic to discuss, each type requiring its own little write up to explain it in detail. But whether you’re doing it yourself or in contact with a reliable tax practitioner, here is a broad (non- exhaustive) list of docs you can start collecting to get prepped for tax season (or correct your current chaotic state of affairs).
Happy eFiling (gulp):
1. Your IRP5 tax certificate: What it is? It’s a form that contains a summary of info for 1 financial year (i.e. the year of assessment) about (a) your total income/ basic pay, (b) allowances, (c) fringe benefits (d) deductions like pension/ UIF (e) exemptions and other personal details necessary to calculate how much tax you owe. You can get it from your HR department.
2. Payslips: It’s always good to keep a record of this on hand per month for good filing. Many organisations upload and make it available for download via an intranet. Alternatively, simply ask your payroll department for it and keep track of it over time.
3. Medical aid claim records: Lots of depth in understanding how medical aid records are handled in determining how much tax you owe. Let’s keep it simple for now! Collect & record these.
4. Transport log book: If you get a petrol/ fuel or car allowance, it is handy to keep a log book of actual distances travelled for work purposes only. It seems like admin, but once you get into the habit of logging the distance from point A to B in your phone after every trip (yeah, I know right?), it becomes easier. Not a train smash if you haven’t got this, but presenting proofs of actuals might get you easy benefits you shouldn’t waste.
5. Retirement annuity, property declaration & investment records: It’s all income and it must be accounted for depending on its value.
Tip: The struggle was real coming straight out of University and into the working world with little knowledge on how to do my taxes and eFiling.
As time went by, it removed a lot of pain to simply attain the services of a tax practitioner to do this for you. Although not essential at all, tax practitioners have the necessary savvy to navigate through your portal and get your tax affairs neat, tidy & headache free.
Many charge a 10- 20% fee on the tax refund they were able to acquire for you (if any); whilst others may charge a fixed fee depending on how messy your affairs actually are.
