Submitting annual income tax returns is a routine procedure for most taxpayers, but there are some who are not sure of their obligations in this regard.
The possible reason for this is that many people do not refer to the annual public notice that SARS issues which clearly outlines the requirements for furnishing returns for the assessment of normal tax. Perhaps taxpayers are unaware that the public notice exists?
The submission requirements do change from time to time and so it is important to understand the content of this notice before proceeding with any filing activity.
On 3 June 2016, the Commissioner published a notice of his requirements in respect of the 2016 year of assessment. A summary for the 2016 Tax year of assessment follows below.
1. Persons required to submit income tax returns
1.1 All resident companies, trusts or other juristic persons;
1.2 Non-resident companies, trusts or other juristic persons which:
1.2.1 carried on trade through a permanent establishment in SA;
1.2.2 derived income from a source within SA; or
1.2.3 derived/incurred any capital gain/capital loss from a source within SA;
1.3 All companies incorporated, established or formed in SA but which are exclusively resident in another jurisdiction in terms of the provisions of double taxation agreement;
1.4 All natural persons who:
1.4.1 carried on any trade in SA;
1.4.2 received an allowance or advance for travel or subsistence whilst on business away from home overnight or in respect of a public office held and whose gross income exceeded the thresholds stipulated in 1.4.8 below;
1.4.3 have capital gains/losses exceeding R30 000;
1.4.4 are resident and held funds in foreign currency or assets outside SA with a combined value exceeding R225 000 at any stage during the 2016 tax year;
1.4.5 are resident and to whom income or capital gains from funds in foreign currency or assets held outside SA could be attributed;
1.4.6 are resident and held participation rights in a controlled foreign company;
1.4.7 are issued with an income tax return or a written request by the Commissioner to furnish a return, irrespective of their level of income;
1.4.8 at the end of the 2016 tax year:
188.8.131.52 were younger than 65 and whose gross income exceeded R73 650;
184.108.40.206 were 65 or older but younger than 75 and whose gross income exceeded R114 800; or
220.127.116.11 were 75 years or older and whose gross income exceeded R128 500;
1.5 All non-residents whose gross income consisted of interest from a source in SA and was not exempt from income tax;
1.6 Every representative taxpayer of the persons referred to in 1.1 to 1.6 above.
2. Persons specifically not required to furnish income tax returns
2.1 Natural persons referred to in 1.4.8 whose gross income consisted solely of one or more of the following:
2.1.1 remuneration other than an allowance or advance referred to in 1.4.2 from a single source not exceeding R350 000 and from which PAYE has been correctly withheld;
2.1.2 interest from a source within SA not exceeding:
18.104.22.168 R23 800 in the case of persons younger than 65; or
22.214.171.124 R34 500 in the case of persons aged 65 years or older; and
2.1.3 dividends in the case of persons who were non-resident throughout the 2016 tax year.
3. Timing and deadlines for submission of 2016 income tax returns
3.1 Companies – within 12 months of the financial year end
3.2 All other persons:
3.2.1 manual submissions – on or before 23 September 2016
3.2.2 electronic submissions:
126.96.36.199 ordinary taxpayers – on or before 25 November 2016 via e-filing or through the assistance of a SARS official at any SARS branch
188.8.131.52 provisional taxpayers – on or before 31 January 2017 via e-filing
3.2.3 where accounts are drawn at a date after 29 February 2016 but on or before 30 September 2016 with the permission of the Commissioner – within six months of the date to which the accounts are drawn.
Section 25 of the Tax Administration Act requires returns to be submitted in the prescribed form and timeously. Information required to be disclosed must be complete and accurate and the person signing the return, whether it be the taxpayer or a representative, is regarded as being cognisant of the statements made therein. A person who does not receive a return form is not relieved from the obligation to submit a return.
For further information or for assistance in submitting your income tax returns, please contact Mike Betts.
To read the next article from our August 2016 e-Taxline entitled: Transfer pricing document retention net cast wider. Many SMEs to be affected. click here.