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Don't Lose Out This Tax Season (2019)

Bernard Schoeman
CA(SA), Post Graduate Diploma Accounting, BCom
The Tax Shop Head Office
SARS has indicated that taxpayers who meet ALL of the following criteria need NOT submit a tax return for 2019:
  • Their total employment income for the year before tax is not more than R500 000.
  • They only receive employment income from ONE EMPLOYER for the full tax year.
  • They have no other form of INCOME (e.g. car allowance, business income, and rental income, taxable interest or income from another job).
  • They don’t have any additional allowable tax related deductions to claim (e.g. medical expenses, retirement annuity contributions and travel expenses).
The reality is that most taxpayers who earn employment income of less than R500,000 and who work for a single employer and who do not have any other sources of income will NOT submit a tax return.  Many taxpayers who meet these requirements are under the misguided belief that it's not wortwhile submitting a tax return.  This has been evidenced by the level of submissions in previous years where SARS also allowed significant income thresholds for not having to submit a tax return.
 
However, most taxpayers have allowable tax deductions through contributions to medical aid funds, pension, provident and retirement annnuity funds which will, more than likely, result in a tax refund to the taxpayer, but are lost forever by not submitting a tax return.  Let's take a look at an example.
 
For the year ended 28 February 2019, a taxpayer (under the age of 65) earns a salary of R15,000 per month and contributes R500pm to a medical aid fund (for taxpayer and their spouse).  As the taxpayer only works for one employer and does not have any other forms of income they elect not to submit a tax return (also because their annual income amounts to R180,000 which is well below the threshold of R500,000).  The taxpayer will lose out on the following refund:
 
                                                                         Tax Return                       Tax Return
                                                                      Not Submitted                    Submitted
--------------------------------------------------------------------------------------------------------------
Annual income                                                R180,000                          R180,000
 
Annual tax caculated                                       R18,333                            R10,893
 
Employees tax (PAYE)
withheld by employer
during the year                                                (R18,333)                         (R18,333)
-------------------------------------------------------------------------------------------------------------
TAX REFUND                                                             -                                  (R7,440)
-------------------------------------------------------------------------------------------------------------
 
The above example is a simple one, but is a good illustration of how the average taxpayer will lose out this tax season.  The lost refunds will be even greater if the taxpayer had made contributions to a pension, provident or retirement annuity fund.
 
Make sure you don't lose out this tax season by contacting a Tax Shop near you.


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More about Bernard Schoeman

Bernard is an executive director and founder of The Tax Shop Franchise.  He studied BCom majoring in information systems and accounting at the University of Cape Town and qualified as a Chartered Accountant (SA) in 1997 after completing his articles with Deloitte & Touche.  Bernard has extensive international and local experience having worked for nearly three years with financial institutions and other companies in the UK (London) and having audited numerous companies listed on the JSE in South Africa. He established a successful consulting firm and auditing firm in SA which provided excellent practical experience in dealing with various clients throughout SA and which ultimately led to the formation of The Tax Shop Franchise. He is a member of the South African Institute of Chartered Accountants.


You are invited to contact Bernard Schoeman by email at enquiries@taxshop.co.za or visit our website at www.taxshop.co.za with regards to the services The Tax Shop offers and how your business could benefit from these services. Making your life easier!