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2oceansvibe’s favoured tax experts, Galbraith | Rushby, have provided a summary of what the latest SARS 2020 tax season announcement means for South African taxpayers.

On May 5, SARS announced new tax filing seasons and a much more heavy-handed approach to companies who are not submitting their EMP501’s and IRP5’s timeously.

There will be a renewed focus to ensure that all employers are fully compliant in terms of their filing and payment obligations. In order to achieve higher compliance, SARS will interface with the National Population Register, the Companies Registrar, and the Deeds Office.  

SARS has put in place a three-phased approach:

• Phase 1 – April 15 to May 31 2020 – Employer and third-party filing.
• Phase 2 –June 1 to August 31 2020 – Taxpayers to update their files (Bank Acc, addresses etc) / SARS follow up with non-compliant Employers/Third-party data providers  / Auto Assessment of certain taxpayers and possible early filing for some taxpayers
• Phase 3 – September 1 to January 31 2020 – Tax filing for the remainder.

Due dates for the submission of IRP5’s and all third-party data (Bank interest certificates, Pension certificates, Medical certificates) is May 31, 2020.  SARS has said that third-party data providers who remain wilfully non-compliant will be criminally charged during the period of June 1, 2020 to August 31, 2020. 

In the two days prior to lockdown, SARS sent a number of notices warning employers who had filed their previous IRP5’s late, of criminal prosecution.  

During the period up to August 31, SARS will auto-assess taxpayers who only have one IRP5. The taxpayers will have an opportunity to accept this auto-assessment, and if not accepted, will be required to submit their returns later.

It seems that SARS will allow certain taxpayers to file their returns before September 1, but only if their employers and third-party data providers are tax compliant. The wording used by SARS is, “individual taxpayers who are required to file but have not been auto-assessed may file early via on-line facilities if their employers & other third-party data providers are fully compliant (which includes no PAYE debt without a proper and secure deferment arrangement)”.

For all other taxpayers, SARS has delayed tax season to only open on September 1, whereas in previous years, it opened on the July 1.  SARS will notify taxpayers to whom phase three filing applies.

It seems as though SARS strategy is to allow employees of tax-compliant companies to file early whilst employees of non-tax compliant employers will be required to wait until September 1 before they can file. This seems particularly harsh as this will probably hurt the hardest hit industries the most. This will also be a blow to taxpayers who were counting on submitting their tax returns as soon as possible in order to get their tax refunds.

Tax season deadlines for non-provisional taxpayers will be November 16, 2020 and provisional taxpayers will be January 31, 2021.

The pressure is on employers to ensure that all their returns are submitted and deferred payment arrangements are put in place if they are not able to pay.

A reminder that Galbraith Rushby also compiled a comprehensive list of the funds and relief measures available to help South African businesses during lockdown.

They have now put together a team to assist any businesses that need help with any of the above application processes. They will also assist you in getting tax compliant, which is the pre-requisite for most of the funding applications.

You can email them at COVID-19@galbraithrushby.co.za.