Talking Tax : Let’s make the proper introduction to income tax to you…
Very few of us were taught about tax growing up. That’s why we’re bringing you our ‘Talking Tax’ series which focuses on the things that you need to know about tax in South Africa.
In this edition we will be talking about why getting you tax returns reviewed by a qualified tax specialist is so important.
SARS – the backstory
SARS is a highly efficient organ of the state. The Income Tax Act 58 of 1962 governs how your personal income tax is calculated and governed.
As a South African resident, you are liable for tax on your world-wide income. In other words, you need to pay tax no matter where in the world you earn an income.
SARS maintains a register of both active and inactive tax payers. Their goal is to increase the number of active tax payers and in addition to that, their objective is to ensure that all those active taxpayers are contributing correctly to the countries income.
SARS – trying to make things easier
SARS certainly does not intend to over-calculate tax contributions but the reality is that the organisation very often does. Because of this, and the fact that tax payers details are often incorrect, SARS has a large Rand-value of unallocated and unpaid re-imbursements. How does this happen?
SARS uses an automated tax calculation system to estimate your tax contributions based on the information that it has available to it regarding your employment and income
This automated system is intended to simplify the income tax submission process and encourage tax-payers to hand in their tax submissions on time.
The problem with this process, is that SARS calculations are not always correct. By relying solely on this automated calculation, you run the risk of paying more income tax than you should.
Why you need a tax specialist (clue: we save you money)
Filling out an income tax submission is usually tedious and for many, confusing, which is why SARS came up with the automated income tax calculation and submission process in the first place. The minute you accept that calculation, you cannot go back and change your calculation and you then become liable for whatever SARS decides you owe.
This is where a qualified and skilled tax specialist can save you a substantial amount of money.
By helping you to gather and document the information you need for your tax return, we control what you submit and how much income tax you pay, or how much you are due in refunds.
MSO Accounting provides specialised tax calculation and submission services. We’re highly experienced and make sure that your best interests are taken care of.
Whether you’re an employee, a sole proprietor, or run a registered business, we can help you.
The last word…
COVID-19 has left many people in financial difficulty. Now more than ever, we need to save as much money as we possibly can. Having a tax specialist to help you with your income tax needs, could save you the money that you need for other commitments.
SARS will not stop the income tax submissions process due to COVID-19, so let us help you get your income tax calculations right, at a time when you need it the most.
Email us on office@msoaccounting.com or ring 082 430 6016 to arrange your income tax consultation.
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