In June 2019, SARS announced that if you earn less than R500 000 in a year, you may not have to submit a tax return for 2019. Terms and conditions apply (as usual in life) so you must comply with a strict set of criteria.
BC Accounting Services advise you to take GREAT CARE when using this opportunity to not submit a tax return. If you do not, you may fall into trouble at a later date. Although the criteria allow you to not submit a return, there are excellent reasons to still submit a tax return on a yearly basis. Here are just 5:
1. You miss out on your refund
A refund is monies you overpaid on your taxes and it belongs to you. SARS may owe you a refund but will not pay it! You can only get a refund if you file a return. Something as simple as claiming medical expenses. Another trigger is working for less than 12 months of the tax year, depending on your situation. You do not want to miss out on this refund. This is your money; you have worked hard for it, so claim it back! Again, in order to claim, you must still submit a tax return!
2. You may not be able to borrow money
We all aim to own great assets or go on that fantastic holiday. This requires something called money. it is important to remember that this money may have to be borrowed. The most common is a mortgage for a house or vehicle finance to own that dream car. If you wish to borrow money to make these dreams come true, you may need a tax clearance certificate. This is an important document available for free. However, this can only be obtained if all your returns are up to date and filed appropriately. Remember, in order to borrow it you must submit it!
3. SARS might change their mind
Again, life does not guarantee all things will continue indefinitely. SARS is not different with their rules and regulations. They have a record of this and it can really come back and bite you in the wallet, later down the line. If you normally submit, but this year you don’t, SARS could administer administrative penalties later on down the line for not being compliant. Remember, in order to be compliant, you must submit it!
4. You can’t access your retirement fund
One of the most frustrating situations is when you try and claim on a policy or submit documents for a specific item and there is something missing. Filing a tax return every year means that you will not have any hassle in getting the money, provided you are tax compliant. If you retire or are retrenched, or just need to take money out of your fund early, you need to be tax compliant.
5. A complete record stands in your favour
BC Accounting is built on honesty and every return we submit with our clients, are 100% honestly prepared. This means that SARS (or whomever) can come and have a look and will not find anything untoward. We never hide information from SARS. Having an unbroken filing record leaves SARS officials with no reason to suspect you of any wrongdoing.
This will make dealing with SARS a more pleasant experience because they find you cooperative and with them, which in turn helps them do their job. This makes them treat you with respect and decency rather than being the big bad wolf they are sometimes thought of being. Filing a tax return means you are being a good citizen and contributing towards society!
These 5 reasons are, as you can see, excellent reasons to stay tax compliant.
Submitting your returns now will save you time and money later on. The emotional torment alone is enough to do it now!