10 things you need to know about tax returns

They say that only two things in life are certain: death and taxes. But paying taxes is actually fraught with a great deal of uncertainty. Most people struggle to understand the complexities of the process – how much they owe, when to submit a return and who to speak to if something goes wrong – and view taxpaying as a frightening journey.

Here are ten things that you need to know to file your tax return with confidence.

1. When do I need to start paying tax?

If you are younger than 65 years old, you only need to pay tax in the 2019/2020 tax year if your income is more than R79 000 per year.

This starting taxation amount changes each year, so be sure to check what the threshold is on the SARS website.

If you are older than 65, the tax threshold increases to R122 300, and if you are older than 75, the threshold is R136 750.

2. How do I register to pay tax?

If you have never paid taxes before, you will need to go to your nearest SARS branch with your ID book and proof of residence. You will be registered while you wait, and will then receive an email notification of your registration and tax number. This tax number is yours for life and will be quoted in any future dealings you have with SARS.

3. How do I pay my taxes?

Your employer should deduct Pay As You Earn (PAYE) from your salary each month and pay that to SARS on your behalf, in line with these tax tables. If you have any other sources of income – like rental or interest earned on investments – you will have to declare those to SARS when you do your tax return.

4. Why must I do a tax return?

Every month, you pay tax on the amount of money that you earned in that month. If the amount that you earn fluctuates – for instance because of bonuses, travel or commission – you might pay tax at a higher rate in that month. At the end of the year, you need to make sure that you are paying tax at the correct rate for your annual total – which means you might have to pay money back to or receive a refund from SARS.

In addition, there are some expenses that are “tax deductible”, which means that the amount that you spend on them is deducted from your total taxable income. These include medical aid contributions and retirement annuities. A full list of the tax deductible expenses appears below.

If you earn less than R500 000, you do not have to do a tax return, but remember that you can't get a tax refund if you don't.

5. How do I file a tax return?

There are a number of different ways that you can file your tax return:

These are the documents you need to submit:

Remember that different methods of filing your tax return have different deadlines, so be sure to check the SARS website to make sure you know when your return is due each tax season. Pay on time to avoid penalties.

6. What expenses can I deduct?

7. How soon will I get my refund?

SARS can pay refunds as quickly as one day later, but there have been increased delays in paying returns in the last couple of years.

8. What if I get audited?

When you fill out your tax return, you provide all the information relating to your income and expenditure over the tax year to SARS. If they are in some way dissatisfied, they can request an audit, which means that you are required to provide them with all original documents that prove the numbers you have quoted.

Although an audit is a painful experience to go through because of the admin involved, if you have been honest in your return and kept track of the correct documentation, you should have nothing to worry about.

9. What if I think that SARS is wrong?

If you have any concerns about your tax assessment, you can contact the Tax Ombudsman for their intervention in the matter.

10. How do I avoid being scammed?

Unfortunately, scammers are becoming increasingly sophisticated, and it is now common for taxpayers to receive emails that say they are from SARS, announcing a tax refund, and requesting your banking details to process the payment. Don't be afraid