Salary / IRP5 Posts in TaxTim's Blog

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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IRP5 FAQs



What is an IRP5?
An IRP5 is the employee's tax certificate that is issued to him/her at the end of each tax year detailing all employer/employee related incomes, deductions, and related taxes. The employee uses it specifically to complete his/her income tax return for a specific year.

Do I need an IRP5?
Yes, you do if you were employed during the tax year.

Can I submit a return without an IRP5? OR Am I able to submit returns without my IRP5? OR Are you able to submit without the IRP5?...

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2017/2018 Budget - The rich are going to pay more, but what does that mean for the rest of us?





Personal Tax Rates (rates below)

Individuals across the country, those qualifying above the new tax threshold of R75 750 (previously R75 000) will be paying increased taxes of R16.5bn (previously R5.65bn in actual tax increase) for the next tax year, most of this will be for high income earners, however. Taxpayers generally across the board will be earning the tiniest bit more money each year as their tax brackets...

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5 Great Reasons to File Your Tax Return Early This Year



Are you the type of person dashing into the store to grab a birthday gift en route to a party? Or perhaps you’ve found yourself scratching through your craft box at 11pm the night before to make a ‘World Book Day’ outfit for your son? Or possibly you’re one of the hundreds of thousands of South Africans who waits until the last week of November to file your tax return?

While I’m not suggesting that every minute of your life needs to be pre-planned and organised, there are certainly a number of benefits to getting your tax done early...

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2016 Budget Speech: Welcome Back, Minister! You Couldn't Have Returned Just for the Free Lunch?



The 24th of February 2016 was supposed to be a watershed moment for the Economy of South Africa. The old-new Minister of Finance, Pravin Gordhan, was to deliver his budget for the 2016/2017 tax year and save South Africa from a financial pit-fall in the form of an International Ratings Agency downgrade. The jury is still out on whether or not this is possible. Immediately after the budget was revealed the Rand tumbled 2%, which doesn’t bode well for market sentiment. However, ...

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2016/2017 Tax Tables



Income Tax Tables for the 2017 Tax Year - 1 March 2016 to 28 February 2017


Income Tax Thresholds



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What You Need to Know About Changes to the Tax Clearance System



Tax compliance makes its way into many aspects of life and business. Perhaps you’re considering applying for a tender, or for a foreign investment allowance to move funds offshore, or even looking to emigrate and leave our shores. These are just a few examples of instances where you may be asked by a third party to provide a Tax Clearance Certificate.

And until now, the course of action to obtain your certificate has been a tedious one.

Upon request, SARS would check its records and verify that the taxpayer had filed all required tax returns, paid all taxes, penalties and interest due, before releasing a Tax Clearance Certificate confirming a good standing...

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Retirement Funds Tax Laws Effective 1 March 2016 - How SARS' New Changes Affect You!



If you’re diligently putting money away for your retirement in the form of a pension, provident fund or retirement annuity, you may be curious – perhaps even a touch concerned – about the changes SARS has made to the retirement fund tax laws, which come into effect on 1 March 2016.

If you missed the news, here's a quick overview.

SARS have changed how contributions to retirement funds are treated from a tax perspective, as well as how your funds are managed when you retire...

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Calculate interest on late provisional tax payment



SARS charges interest on late payments made toward provisional tax deadlines.

To calculate this late payment penalty, use the formula below:

Provisional tax amount x 7% x (days after deadline / 365)


Use the calculator below:



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Swear an affidavit for SARS



Has SARS asked you for documents that you can't produce, such as an old IRP5 from a prior year that your employer doesn't have, or that simply doesn't exist?

To prove to SARS that you cannot produce the document they want, you will need to produce what is called a sworn affidavit.

This is basically a letter that you must write, that you then take to your nearest police station to get signed and stamped.

Items to include:

1. Your name, ID number and contact details...

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SARS isn't paying my refund, they want my old returns!!!!



Taxpayers this year are facing a new gripe with SARS when it comes to receiving those well-earned refunds. The current two scenarios are:

  • NO AUDIT: A taxpayer files a tax return, gets their ITA34 and does not need to submit supporting documents; or
  • AUDIT: A taxpayer files a return and in their ITA34 is requested to submit supporting documents, after which they receives a Completion Letter stating "no adjustment made".

In both these cases a refund should be paid out a few days later (if the taxpayer is due one), however thousands of taxpayers still have not been paid their refund. Here’s why!...

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SARS Tax Tables 2015



Tax Thresholds:


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Thank you Minister - we expected worse! 2015 Budget



New Finance Minister Nene delivers his first budget with some “better than expected” tax increases. The fight against corruption was highlighted with the minster announcing a series of reforms and procedures to be introduced both to curb corruption and make doing business with the state easier. The minister announced that R25bn would be saved in expenditure over the next two years, but R16.8bn is to be raised this year via tax increases and a remarkably large rise in the fuel and road accident fund levies. To be honest, we expected greater tax increases from the minister, thankfully he spared us some of the pain! ...

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How to calculate totals under source codes 3696, 3697 and 3698



If you tried to submit your tax return and got an error relating to 3696, 3697 or 3698 then you might have simply left an amount out!
Check your IRP5 to make sure you answered TaxTim's questions for these amounts correctly.

 
Your IRP5 can show one or more amounts with source codes describing the income you received from your employer that year.

A common example would be:

Salary R240,000 - source code 3601 ...

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2014 Budget - A move to economic transformation



In delivering what could possibly be his last annual budget and perhaps in an election year a very pragmatic one, Minister Pravin Gordhan painted a rather positive picture for the future of South Africa, whilst at the same time warning of the impact the global economy is having on the South African economy. He too, had a “good story” to tell of how well managed the economy is and how we have survived the economic downturn of the last half decade. The minister, like his predecessors b...

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Garnishee orders explained: How SARS can deduct penalties directly from your pay cheque and how to stop it



The last days of the month are often the most exciting for employees as they look forward to spending their monthly pay cheques. Unfortunately for many taxpayers anticipation quickly turns to grief when the money they receive in their bank account is suddenly less than they had expected. Stress and anxiety then result in light of impending debit orders and monthly expenses that need to be paid.

Apart from the ordinary deductions that your employer takes off your salary each month - expenses for your benefit such as medical aid or a retirement / pension plan - there is another deduction that can take place unexpectedly: a garnishee order...

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SARS Tax Tables for 2014



Tax rates for Individuals and Trusts
Income tax rates: Natural persons (that's you) and special trusts.

2013 tax year: 1 March 2013 - 28 Feb 2014.

Individuals and Special Trusts:



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Important Information for Surviving the SARS Outbreak



From the office of the Center for Dis-Ease Control, 12 Bliksem Straat, Pretoria, South Africa

EPIDEMIOLOGICAL INFORMATION

Severe Anxiety from Revenue Services (SARS) is a common affliction affecting millions of South Africans in all major city centres every year. Historically, symptoms begin to present themselves in the winter season from 1 July and continue to increase in severity towards a statistical peak for the epidemic on 22 November every year...

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The effect of the 2013/14 annual budget speech on the average South African taxpayer



It was with great enthusiasm that we at TaxTim awaited delivery by the Minister of Finance of his annual budget speech this afternoon, especially after some of the shocks experienced by taxpayers and tax professionals last year. Surprisingly he delivered a very mild budget in terms of individuals with the Minister stating, “No tax rises.” The main focus areas relating to tax in this budget speech were on compliance, tax evasion and big companies seeking to shift their income around the world in order to avoid higher taxes...

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Why employers should help their employees with tax



Individual taxpayers have traditionally been told that when it comes to tax returns, they're on their own with regard to submitting each year and their employer does not need to get involved. Despite the employer making payment of PAYE (the majority of their tax liability) on their behalf, after handing over their IRP5 detailing this payment they resume business as usual and the employee is left to navigate the ever-challenging tax system on their own, without any assistance. Fortunately this attitude is changing as more companies recognise the benefits of helping staff with their tax matters. ...

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SARS Tax Tables for 2013



Tax rates for Individuals and Trusts
Income tax rates: Natural persons (that's you) and special trusts.

2013 tax year: 1 March 2012 - 28 Feb 2013.


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How to manage your tax affairs running a business in your own name as a sole-proprietor



South Africa is brimming with entrepreneurs and small business owners who keep the economy running. These people may or may not be earning a regular salary too, but all of them operate a non-registered business in their own name - a so-called sole-proprietorship. In this blog post we will discuss how such a business pays tax, how it is taxed, and how to separate personal and business affairs to make tax deductions correctly.

To register or not to register as a company? ...

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Why do I need to submit an Income Tax Return if my employer pays my Tax?



A question often asked is, "If my boss pays over my tax then why do I have to do anything?"

If you earn below R160 000 per year, SARS does not require that you complete and submit an ITR12 tax return. HOWEVER SARS will charge you an admin penalty for not submitting a return AND if you don't mention all your deductions you can't maximise your potential refund. So rather submit a return every year and stay tax compliant. With TaxTim it's easy. Remember as well that SARS doesn't know everything about you so you need to tell them to maximise your potential refund! ...

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What to do if your second ITA34 assessment says you now owe SARS money



If you have ever survived a SARS audit, you may have been issued with a "revised assessment" or second ITA34 that doesn't make much sense. It probably says that you now owe SARS some money, despite being due a refund. Don't be alarmed though, if you read lower down the new ITA34 you will find that in fact you are still due a refund, only it is probably smaller than before.

For example:

First IT34A (before audit):
SARS says: "Your assessment has been concluded and reflects an amount refundable to you of R-16 636.10"...

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SARS is asking for more documents. Are they auditing me?



For most people upon submission of their year-end income tax return, either nothing much will happen or a refund will be due, this being paid back within a matter of days. However in a small number of cases SARS requires extra documentation or proof to be submitted so that they can verify that everything you submitted in your tax return is correct. Don’t be afraid, although many people consider this an “audit” it isn’t nearly as frightening as that and doesn't mean you have done anything wrong. A true audit would be SARS requesting years of past documentation and opening up for examination all your tax affairs from previous years. ...

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