Salary / IRP5 Posts in TaxTim's Blog


Food for Thought on Subsistence Allowances



You’ve been up since 4am in order to catch yet another red-eye flight for a 9am business meeting - 1,400km away - and you’re already onto your third coffee by the time you board the plane.

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Sole Proprietor or Company: What's Best for Tax?



Getting a new business venture off the ground is an equally exciting and stressful time. You’re enthusiastic about getting your new product or service out into the market, but you face quite an administrative process to get it off the ground legally.

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Why don't I get a tax deduction for Out of Pocket Medical Expenses?



Why don't I get a tax deduction for Out of Pocket Medical Expenses?

Tax season always throws up some interesting and confusing calculations, but for many, the most confusing of all is how medical aid contributions and Out of Pocket medical expenses are treated.

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Tax effects of your salary structure



Tax effects of your salary structure

We often receive questions from taxpayers as to how to structure their salary most efficiently for tax purposes.  Unfortunately, the reality is that the days of employees gaining a tax advantage

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Top Questions on Income that is not taxed



Top Questions on Income that is not taxed

Exempt or non-taxable income refers to certain types of income, which is not subject to income tax.

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Why does SARS require manual intervention to finalise my return?



Why does SARS require manual intervention to finalise my return?

When a Tax Return is filed usually SARS issues an immediate assessment (ITA34), however sometimes they do need to do a further manual check on their side.

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5 Reasons you Still Need to File your Tax Return in 2019



5 Reasons you Still Need to File your Tax Return in 2019

SARS has just announced that if you earn less than R500 000 in a year, and fulfill a series of complicated criteria, you may not have to file a tax return for 2019.
Previously, SARS had communicated that if you earn less than R350 000 in a year you may not have to file a tax return.

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:

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Top Questions on IRP5s



Top Questions on IRP5s

It’s that time of the year again and employers are issuing their employees IRP5s for the 2019 tax year. An IRP5 is a tax certificate which shows the total employment income that you earned for the tax year, the total employment related deductions that were taken from your income and paid over to either a retirement fund (pension, provident or retirement annuity fund) or a medical aid and the total tax  (PAYE, UIF and SDL) that you paid...

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Multiple Employers, Multiple PAYE payments. Yet I still owe SARS?



Multiple Employers, Multiple PAYE payments. Yet I still owe SARS?

We receive many questions to our Helpdesk from taxpayers who are faced with the following scenario:

They work for two employers during the year, perhaps even at the same time and earn income from both. Each employer deducts employee’s tax (PAYE) from the taxpayer’s salary every month and issue them with an IRP5 after year end.

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Do You Need to Ring-Fence Your Business or Rental Losses for Tax?



When pursuing a business activity, trade or renting out a property, you’re no doubt doing so to make some money, but the reality for self-starters is that there’s a good chance it’s going to take some time for your venture to break even, which can often mean facing a loss.

Your additional income is of interest to SARS as it translates into more tax revenue for them, so how do you record your loss to them? And when, how and where is the loss applied from a tax perspective?

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Why is SARS asking me for outstanding tax returns?



Why is SARS asking me for outstanding tax returns?

When did this happen?

Previously, assuming that SARS did not request any documents for verification and everything for the year was accepted, refunds due were typically paid out quite quickly to taxpayers within 1-2 days.

From 2015, SARS has implemented a new requirement that ALL tax returns, since the first year a taxpayer registered for a tax reference number, must be submitted before any refund is paid out.

...

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Why have I received a smaller tax refund from SARS this year?



Why have I received a smaller tax refund from SARS this year?

We receive many queries from confused taxpayers who are disappointed to see their tax refunds are smaller than the refund received last year. Often, on the surface, their income and expense situation appears unchanged, so how can this be?

If you are one of these unhappy taxpayers, read on to see some common reasons why your tax refund could be less than last year.

Carried forward retirement contributions

This one is not obvious at all and confuses many taxpayers...

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Medical Aid Tax! How SARS' new changes affect YOU!



Medical Aid Tax! How SARS' new changes affect YOU!

In 2012 SARS began making changes to how medical expenses were treated for tax purposes. The system at that time created a higher benefit for deducted medical expenses if you earned a high income (bad news for low income earners) and the changes since then have sought to make medical deductions more equal across various income levels.

Basic summary of how SARS calculates your tax

Income Earned
Less: Expenses / Deductions
= Taxable Income
x SARS tax rate ...

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What to expect in 2018 after submitting your tax return to SARS



What to expect in 2018 after submitting your tax return to SARS

As soon as tax season opens in July, many taxpayers rush to submit their ITR12 tax returns as early as possible, eagerly hoping for a nice refund. After the rush, when nothing happens, they often ask us what is happening to their refund? In most cases where an income tax refund is due to a taxpayer, SARS pays it out within one or two days...

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How to calculate totals under source codes 3696 and 3699 for 2018



How to calculate totals under source codes 3696 and 3699 for 2018

Perhaps you just tried to submit your tax return and you instantly got an error relating to 3696 and 3699. As frustrating as it could be, don’t worry the error can be fixed. Maybe, you might have just simply left an amount out. Let’s have a look at what you should do, in order to crack these codes correctly – in that way making filing much more easier for you. 

You’ll need to check your IRP5 to make sure you answered TaxTim's questions for these amounts correctly...

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How to calculate totals under source codes 3696 and 3699 for 2017



How to calculate totals under source codes 3696 and 3699 for 2017

Perhaps you just tried to submit your tax return and you instantly got an error relating to 3696 and 3699. As frustrating as it could be, don’t worry the error can be fixed. Maybe, you might have just simply left an amount out. Let’s have a look at what you should do, in order to crack these codes correctly – in that way making filing much more easier for you.

You’ll need to 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. ...

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I work for someone, but did not receive an IRP5 - what should I do?



I work for someone, but did not receive an IRP5 - what should I do?

You may be employed by someone, but for one reason or another- you don't receive an IRP5 and no amount of begging or pleading will result in one being produced. If you're one of these “IRP5-less” individuals, this shouldn’t keep you from completing your tax return. 

Below are some situations where taxpayers will not receive an IRP5 - read on to find out if any of these apply to you and if so, what to do about it.


1. You work overseas for a foreign employer.

If you work overseas for a foreign employer and no tax is deducted from your salary in South Africa, you will not receive an IRP5...

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10 Tips to Pay Less Tax



These tips are part of TaxTim's personalised recommendation tool called the Tax Health Score. Once you file your tax return with TaxTim, we analyze it and produce your own unique Tax Health Score which recommends how you can optimize deductions, pay less tax and maximize your potential refund in the future.

The tips below cover all possible recommendations and may not be applicable to your individual tax situation. The only way to know which ones apply to you is to use TaxTim to complete and submit your tax return....

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



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!



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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I worked for less than a year: Do I still need to submit a tax return?



I worked for less than a year: Do I still need to submit a tax return?

If you worked for less than a year, you may be confused as to whether or not you are required to submit a tax return. It seems like a tedious task for someone who only worked for a few months of the year and was unemployed for the rest. However, the answer is YES, you must definitely submit a tax return, even if you’ve worked for less than twelve months.

The reason is that, if you only worked for a few months of the year and paid tax, it's likely that you are due a refund. Read some other reasons here, why we recommend you always submit a tax return....

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Who's (Legally) Allowed to File Your Tax Return?



Tax isn’t the easiest of subjects to navigate. Besides the long list of legalese to master, there’s the fact that tax legislation evolves year on year. What was applicable on your tax return 2 or 3 years ago, isn’t necessarily valid on your next, and what’s right this year, may change next season.

It’s unsurprising then, that when faced with the daunting task of filing their annual tax return, many people turn to a friend, colleague or trusted broker to help them out, in the hope that they’re more proficient...

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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?



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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Promised a Guaranteed Tax Refund? Be Afraid - Be Very Afraid



Promised a Guaranteed Tax Refund? Be Afraid - Be Very Afraid

Guarantees are pretty powerful – they’re used by leading manufacturers and retailers to gain our confidence and trust. We’ve all come across them at some point or another: “Life time guarantee”, “money back guarantee”, “product satisfaction guaranteed, or your money back”. They’re a promise. A promise that your purchase will provide you with a level of value, or a return on your investment. While a guarantee is common – expected, ...

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