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My total taxable return is higher than normal, am I being punished for bonuses received this year?

Posted 25 September 2015 under Tax Questions



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Brian says:
19 September 2015 at 7:10

Hi Tim, I have recently completed my tax return. I received a first assessment that said I owed SARS 7630 but I was selected for verification. After the verification process, I received another assessment that reflected R0 amount. But it appears I still owe the initial 7630. Firstly, I don't understand the different conclusions reached in the two assessments and why the first one appears to hold still. Second, my total taxable income for the year being assessed is unusual in the sense that it included a lot of bonuses, including the pension fund I claimed when I left my previous employer. In being required to pay SARS additional tax, am I being punished for the bonuses paid?

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TaxTimTaxTim says:
23 September 2015 at 17:44

Please could we ask you to upload the assessments to this helpdesk or provide us with the SARS eFiling username and password and we will have a look at what has happened.


Brian says:
24 September 2015 at 2:40

As requested:

SARS eFiling username: aoyowe8884
password: DOM2#ingoSARS

Please do explain to me what code 3801 on one of the IRP5 certificates - fringe benefits means, and whether it applies if one is no longer with the relevant employer.

Thanks,
OA Oyowe


TaxTimTaxTim says:
24 September 2015 at 18:32

Source code 3801 is for a general fringe benefit you received whilst working for your employer, did they provide you with any extras which were outside your salary.

The amount owing is correct unfortunately. What has happened is that your second assessment has just confirmed the first assessment so it has not changed. The reason you owe extra money is because each IRP5 that was issued from each employer shows PAYE deducted as if that was the only income that you earned and did not factor in that you have earned income from other companies later or earlier in the year. Tax is calculated on the total amount of income earned which means due to you earning more income when added together and bumping up a tax bracket the PAYE deducted per employer was actually too little which resulted in you having to pay into SARS. I hope this makes sense.


Brian says:
25 September 2015 at 7:14

Thanks TaxTim.

If extras include company laptop and tab that I used to do company work then yes - but these items were never mine and I left them behind months after they were purchased - i.e. when I left my previous employer last year.


TaxTimTaxTim says:
25 September 2015 at 8:41

You would have to check with the employer what this inclusion was for, but if you were given assets to use only for business purposes and not for your personal use then these should not be taxed in your hands.


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