income tax returns - IT12TR, ITR12, IT14
Annual income tax returns are submitted via SARSefiling to SARS on or before
specific deadlines and each return are vastly different for each type of
taxpayer (individual – ITR12, company – IT14 or trust – IT12TR).
The income tax return data for companies and trusts are compiled from the
annual financial statements. The income tax return data for individuals greatly
depends on the type of income the individual has earned during a specific tax
year and which deductions are allowed in respect thereof.
The information that is reflected on the annual income tax return must be
accurate and correct, especially pertaining to individuals, as penalties and
interest would accrue due to incorrect information being furnished upon
submission of the return. The new strict penalty regime is imposed as part of
the Tax Administration Act (TAA) of South Africa.
Quality assurance is our standard at ShoniNelushi Accountants, we strictly
adhere to this as more and more responsibilities are given by SARS to tax
specialists, accountants and auditors. We do foresee that this trend by SARS
will continue in the future, thereby levying more responsibility and quality
verification onto the shoulders of the taxpayer and tax consultants.
Tax clearance certificate - TCC-001
A tax clearance certificate should be issued and requested by every single
taxpayer. This certificate indicates to a client whether their tax returns with
SARS are submitted, up to date and paid in full. This certificate is one of the
many criteria pertaining to tender applications and frequently requested by
various industry watchdogs, boards, creditors, and suppliers.
At ShoniNelushi Accountants we believe that this is a necessary document that
each client or taxpayer should request during any period of the tax year. It
validates the taxpayer's status with SARS. This certificate would not be issued
by SARS if any return within any registered tax category is outstanding or if
any amount is due to SARS.
Tax deduction directives (commission income) - IRP3
Tax deduction directives that are issued to individuals that earn commission
income is divided into fixed percentage- or fixed amount directives. These
directives in broad terms will replace the staggered tax tables for individuals
(the more you earn the more you pay), with a fixed percentage or fixed amount
per month deducted for pay-as-you-earn (PAYE).
It is vitally important that this method of calculating PAYE does not create a
tax liability for the taxpayer once his/her return is assessed, as this would
cause penalties and interest to be triggered as per The Tax Administration Act
of South Africa (TAA).
Provisional tax returns - IRP6
tax returns are not issued automatically by SARS via SARSefiling. They relate to
an interim 6-monthly tax return that is issued with relation to any income an
individual taxpayer has earned during a tax year that was not taxed during the said
tax year (for example rental income, business income, etc.). Trading companies,
close corporations and trusts must be registered for provisional tax by
Provisional tax returns must be compiled and submitted by a tax specialist as
the calculation pertaining thereto could be complicated and therefore an in
depth understanding of the Income Tax Act of South Africa would be required.
Provisional tax returns are estimations during each 6-month period of the tax
year in which a taxpayer would calculate how much income tax should have been
paid for said period on income that is taxable, but was not taxed. The
estimation must at least be 90% of the actual value of taxable income reflected
once the annual tax return is submitted. Therefore, provisional tax is not a
separate tax category, but forms part of income tax payable in 6-monthly
Non-compliance to submit the provisional tax return, or late submission and
payment would lead to penalties and interest that would accrue and must be paid
once the annual income tax return is assessed for said tax year according to
the Tax Administration Act of South Africa (TAA).
SARS debt management
SARS will request that debt management be done
on a taxpayer if a taxpayer has an outstanding SARS account that cannot be
repaid in one lump sum. The process evaluates the taxpayer's full financial
position and outlook, including all income and expenses. In those cases, which
have become more frequent due to the worldwide economic meltdown, SARS and the
government have been lenient and do afford taxpayers the opportunity to stagger
the payment towards their overdue account(s).
At ShoniNelushi Accountants, we assist our clients and intervene on their
behalf with SARS to resolve any outstanding tax issues and queries so that they
can become tax compliant. This could be a stressful and daunting task for a
client, but it does not need to be. The Tax Administration Act of South Africa
(TAA) allows taxpayers that were not compliant before "to come clean"
with SARS and settle their outstanding debts amicably.
ShoniNelushi Accountants will only follow the procedure to appeal and
thereafter object against an assessment according to the Tax Administration Act
of South Africa (TAA) if all other avenues have been exhausted. Our company
will advise taxpayers that only tax specialists that are highly qualified in
the tax field should liaise with SARS on this level directly
Annual processing (individuals)
Annual bookkeeping is required for commission agents, contract workers, sole
proprietors, partnerships and proprietors earning rental income.
ShoniNelushi Accountants, quality of work is one of our cornerstones and
therefore processing is done with great detail and care, thereby allowing SARS
to effortlessly verify any income and/or expense items being reflected as part
of the income-and-expenses statement submitted with a client's income tax
Every line item is crosschecked to external documentation
giving proof to the income being received and expenses being claimed, as well
as various sections of the income tax act and practice notes applied in the
preparation of the income-and-expenses statement
ShoniNelushi Accountants (Pty) Ltd