Latest Posts in TaxTim's Blog

The Less Common Tax Deductions




We’re aware that sometimes taxpayers may not understand all of the deductions which appear on the tax return. And because of this, expenses that could have been deducted get missed. To help make things easier for you, we’ve explained some of these less understood tax deductions which may be overlooked by taxpayers.  They all appear in the Other Deductions section of the ITR12.

The s11(nA) and s11(nB)
If an employee is in breach of an agreement with their employer, they may be asked to pay back a benefit they received from them e.g bonus, maternity leave benefit, bursary, sign on bonus etc. ...

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Be smart and save tax when receiving income from an Airbnb




Taxpayers who earn Airbnb income often don’t know what they need to do when it comes to declaring this income to SARS. Sometimes taxpayers think that they don’t have to declare this extra income, or can hide it from SARS by not entering it on their tax return form - a big mistake!

The truth is that extra income earned from Airbnb income is taxable, and SARS needs to know about it. In some cases - if the amount earned (profit) outside of a salary is larger than R30,000 a y...

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The 3 R's: Returns, Rebates and Refunds Explained




When it comes to tax jargon, most people prefer to bury their heads in the sand instead of trying to understand all the confusing terms that tax practitioners use. Taxpayers just want to do their tax quickly and easily, and if they’re due - receive some money back from SARS. A lot of confusion surrounds the process, but by understanding three simple terms you can make tax season a little bit easier.

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Budget Speech: VAT rises by 1%, predictions were correct!




Taxpayers should breathe a sigh of relief as a much lower than expected R36bn in increased taxes was announced by the once-off Minister of Finance. The biggest news amongst the increases was the VAT rise of 1%. For the first time in 25 years, all South Africans will see most goods and services become a little bit more expensive thanks to the Value Added Tax rise. Although controversial, a VAT rise was much needed and will bring in almost R23...

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Mirror Mirror on the Wall, Where Do We Look to Plug the Shortfall?




By now we are all aware that it is more than likely that SARS will miss its 2018 revenue collection target that it set a year ago by R51bn. The budget deficit (i.e. the gap between government expenditure and income) for the first eight months of the tax year from April to November 2017 widened to a record R195 billion as tax collections lagged due to a slowing economy, low business confidence and a possible slippage in compliance by taxpayers. Sadly, there’s no light at the end of the tunn...

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I've raised a dispute: Do I need to pay?




Many disgruntled taxpayers are receiving SMS’s from SARS who threaten legal action if they don’t pay their outstanding tax debt.

However, these same taxpayers raised a dispute/lodged an objection because they didn’t agree with the SARS assessment and are still waiting for the dispute to be resolved.

This can take up to 60 working days and in many cases, even longer. In fact if the dispute was raised at the end of last year, SARS will take even longer because the period 15 December to 15 Janaury is excluded from the 60 day review period!...

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Latest SARS Guide: Tax treatment of retrenchment benefits




In the past, taxpayers who received a severance payment benefitted from the favourable tax treatment applied to it. It didn’t matter if the retrenchment was ‘voluntary’ or ‘involuntary’ (i.e. forced). If it was their first such lump sum, R500,000 was exempt from tax and the balance was taxed according to special tax tables.

For the first time last year, SARS issued a guide on Tax Directives, which distinguished, between ‘voluntary’ and ‘involuntary’ retrenchments as follows:...

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Disposal of Small Business Assets




If you have reached the age of 55 years, and are thinking of selling your small business, read on to find out more about the special capital gains exclusion of R1,800,000 which may apply to you.

Before getting into the detail, let’s first highlight the three different scenarios where this exclusion may apply:

1. You are selling your business, which you operate as a sole proprietor.
2. You are selling your share of a business, which you run through a partnership....

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Navigating around your Momentum tax certificate (IT3b)









1. Local interest - source code 4201

Navigating around your Investec investment tax certificate (IT3b)







1. Local interest - source code 4201
2. Local dividends - you don't need to enter this on your tax return. This income is exempt....

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Navigating around your FNB tax certificate (IT3b)





1. Local credit interest (income) - source code 4201. 
2. Local debit interest (expense) - you don't need to enter this on your tax return.

Navigating around your Allan Gray tax certificate (IT3b)





1. Local interest - source code 4201
2. Foreign interest - source code 4218
3. Foreign tax credit on foreign interest - source code 4113
4. Local dividends - you don't need to enter this on your tax return. This income is exempt from tax.
5. Real Estate Investment Income (REIT) - source code 4238
6. Foreign dividends - source code 4216
7. Foreign tax credit on foreign dividends - source code 4112...

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Navigating around your Alexander Forbes investment tax certificate (IT3b)




1. Local dividend - subject to dividend withholding tax. You don't need to enter it in your tax return.
2. Local interest - source code 4201.
3. Distribution from a REIT (Real Estate Investment Trust) - source code 4238.
4. Withholding tax on local dividend - you don't need to enter it in your tax return (see note 1).

Navigating around your investment tax certificate (IT3b)



If you hold investments with a bank or financial institution, there is important information on your IT3(b) tax certificate which needs to be included in your tax return.

This will ensure your taxable income is calculated accurately with the correct interest, foreign dividends and foreign tax credits included. 

Do you hold investments at any of the below institutions?


Alexander Forbes...

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Tax and Marriage go together, like a horse and carriage




When planning your wedding, it’s highly unlikely that anything related to tax features on your agenda. However, when saying “I do” it’s very important to understand the tax laws associated with marriage because SARS treats income differently according to the type of marriage contract that binds you and your spouse.

Marriage in Community of Property

If you marry without an antenuptial contract, you’ll by default be married in community of property...

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Navigating around your Medical Aid Tax Certificate



If you belong to a Medical Aid, there is important information on your medical aid tax certificate which needs to be included in your tax return.

This will ensure you receive the medical aid tax credit that is due to you.

Do you belong to any of the below medical aids?


- Bankmed
- Bonitas
- Camaf...

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Navigating around your Wooltru Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 


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Navigating around your Polmed Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 


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Navigating around your Momentum Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 


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Navigating around your Gems Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 


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Navigating around your Discovery Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 

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Navigating around your Camaf Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 


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Navigating around your Bonitas Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid


Navigating around your Bankmed Medical Aid Certificate



1. Name of Medical Scheme
2. Medical Scheme Membership number
3. Number of members/dependents per month
4. Total contributions
5. Claims you paid personally that were not covered by the Medical Aid

 

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The Dangers of DIY Tax: How to Avoid Disaster




Have you ever started one of those ‘oh, this’ll be easy’ Do-It-Yourself jobs, only to find yourself utterly frustrated half-way through wondering - what was I thinking? Pieces of wood cut just a few millimetres short of what they should’ve been. Holes drilled in the wrong places. Screwdrivers in every size except the one you need, missing bolts or the wrong colour paint! These DIY disasters can land up costing you much more time and money to salvage (or in the w...

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