![]() SARS has recently communicated that if you earn less than R350,000 in a year, and fulfil a series of complicated criteria, you may not have to file a tax return in 2017. However, we advise you to take GREAT CARE here, and understand your duties properly, because if you don't, you may suffer for it later on. Here are the top 5 reasons why not to skip filing your tax return this season: 1. You miss out on your refund. Why let SARS keep your money if you are due a refund? A refund is money you overpaid on your taxes and it belongs to you. You can only get a refund if you file a return. Something as simple as claiming Medical expenses or working two jobs can trigger a tax refund, depending on your situation. 2. You can't borrow money. If you wish to borrow money in the form of a mortgage for a home, or a long-term loan of any kind in future, you will need a Tax Clearance Certificate. This can only be obtained if all your returns are up to date and filed appropriately. 3. SARS might change their mind. If you normally submit, but this year you don't, SARS may administer administrative penalties later on down the line for not being compliant. 4. You can't access your retirement fund. Filing a tax return each and every year means that should you receive a payout from a fund at any stage, then you will not have any hassle in getting the money. 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. Having an unbroken filing record leaves SARS officials with no reason to suspect that you are hiding information from them, thus triggering an audit next year. Filing a tax return means you are being a good citizen and contributing towards society! For advise on tax return submission please contact Su-Chin or Su-Lan, email [email protected], tel 011 658 1333 . Source: Taxtim
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![]() What is it? A Medical Scheme Fees Tax Credit (also known as an “MTC”) is a rebate which reduces the normal tax a person pays. This rebate is non-refundable and any portion that is not allowed in the current year can’t be carried over to the next year of assessment. It applies for years of assessment starting on or after 1 March 2012 (from the 2013 year of assessment). Who is it for? The MTC effectively replaced part of the tax deduction that was specifically allowed for medical scheme contributions, and applies to fees paid by a taxpayer to a registered medical scheme (or similar registered scheme outside South Africa) for that taxpayer and his or her "dependants" (as defined in the Medical Schemes Act). This MTC seeks to bring about greater fairness and help achieve greater equality in the treatment of medical expenses across all income groups. The MTC is a fixed monthly amount which increases according to the number of dependants: How does it work?
The MTC will effectively impact both the employer and the employee. This credit must be taken into account by the employer when calculating the amount of Employees’ Tax to be deducted from the employees’ remuneration. Individuals who have not had their MTC taken into account by an employer (for example, an individual who is retired and receives a pension; or an individual who is self-employed) can claim the MTC on assessment by submission of an annual income tax return. If you need assistance with getting your medical aid tax certificate please contact Namhla in our Health department, email [email protected] , tel (011)658-1333 Source: Sars ![]() City Press spoke to Lesedi Seforo, tax project manager at the SA Institute of Chartered Accountants, about the best tax practices for freelancers. Should you form a company or register as a sole proprietor? Seforo says the decision over what legal form you should use should not only be determined by tax, but also by other commercial concerns such as limitations of personal liability. In the case of a sole proprietor, you are the legal entity; in the case of a company, the company would be the legal entity and would hold the liability. From a tax perspective, however, it may not make sense for a one-person consultancy to register as a company. Seforo says the main consideration as far as income tax is concerned has to do with the rate of tax levied on a company versus a sole trader. Most freelancers use the fees they charge as their income and do not necessarily reinvest in the business because the nature of their business does not require capital. For any of your Tax queries please contact Su-Chin or Su-Lan, email [email protected], tel 011 658 1333 Source: Finance 24 |
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