What is an auto-assessment?
This is an automatic assessment issued by SARS to certain taxpayers. SARS will use data collected from employers, financial institutions, medical schemes, retirement annuity fund administrators and other 3rd party data providers to generate the assessment automatically, without any input from the taxpayer.
How will I know if I have been auto-assessed?
You should receive a SMS or email from SARS informing you that you have been selected for auto-assessment. SARS have indicated that they will send these notifications from 1 July to 7 July 2023.
Is the deadline for auto-assessments the same as the tax season?
For the 2023 tax season, the deadline is the same as the tax season for salaried employees i.e the deadline for auto-assessed taxpayers is 23 October 2023.
Last year (i.e 2022 tax season) SARS gave a deadline of just 40 business days for auto-assessed taxpayers to submit their tax return.
Should I accept the auto-assessment?
No, we think there are risks involved. Your auto-assessment may be inaccurate and accepting it, could result in you paying more tax than necessary.
"Why is this the case?"
SARS may not have received all of your tax certificates
SARS may not have your most up-to-date tax certificates
You may miss out on claiming certain deductions, which won’t appear on your auto-assessment e.g. wear and tear, home office, donations to charities, travel expenses and medical expenses you paid personally.
Check our Auto-Assessment decision tree for futher assistance.
SARS have already refunded me the auto-assessed amount - how does this work now?
If you have extra income or deductions to include, you can still file your tax return as normal with TaxTim when tax season opens on 7 July at 8pm. Filing a tax return means that you can include all of your possible deductions so as to pay less tax and maximize your chance of a refund.
When you file your tax return, SARS will issue you an assessment (ITA34) which will show your new tax refund/liability amount. If you included deductions (e.g home office) in your tax return, you should have less tax to pay, which means that SARS will pay you an additional refund for the difference between the auto-assessment and the assessment per your tax return. If however, you included extra income (e.g rental) in your tax return, you will need to make a tax payment to SARS.
Follow steps here to reject the auto-assessment.
If I accept it, and my auto-assessment is incorrect, am I exempt from penalties/legal action?
No, you are not exempt from penalties or legal action. It is your responsibility to ensure you report all of your income and expenses accurately to SARS. If you accept your auto-assessment and you failed to declare some of your income, SARS could levy a penalty of up to 200% of the tax payable (plus interest!) should they audit you later on and discover their mistake.
What happens after 40 working days if I do nothing?
If you take no action, the auto-assessment will become your FINAL assessment after 40 working days.
I want to submit a return, but the 40 day deadline is too short. What can I do?
You will need to Request an Extension on eFiling, before the 40 working day deadline has expired. You will need to provide SARS with 'reasonable grounds' as to why an extension is required. If you miss the deadline, you will have an additional 21 working days to submit a Request for Extension on the same terms.
Missed the 40 day deadline already?
If you missed the deadline, SARS will allow you a further 21 working days to Request an Extension on eFiling.
IMPORTANT: The Request for Extension must be approved by SARS BEFORE you proceed in submitting a correction on the tax return. If you submit a tax return before an extension is granted, it is likely that SARS will automatically reject your tax return and you will need to file a dispute.
Oops, I have done nothing and more than 61 workings days have passed. What can I do now?
You will no longer be able to request an extension. If you don't agree with your auto-assessment, you will need to submit a dispute.
Update:
SARS issued letters on 13 March 2023 asking all taxpayers who filed a 2022 return more than 40 days after they were auto assessed, to request an extension as the returns was all rejected on eFiling.
Previously, SARS set all these returns in a status on eFiling, called "routed for manual assessment", this is a step where SARS would take up to 90 business days to review and if they need to see any supporting documents, they would contact the taxpayer after the 90 working days to forward the documents.
This time around, SARS seem to have removed this option and all returns was just rejected, without SARS even looking at the new submissions, and the option to request an extension is no longer available on eFiling.
If this happened to you, please follow these steps:
Log onto eFiling and open the initial ITA34 SARS issued when they auto assessed your return, compare the assessment to what you resubmitted, if it's identical, there's no need for you to do anything. Please store your documents for 5 years as SARS have already closed the tax year for you.
If your ITA34 is missing some income or deductions, you will need to lodge a dispute with SARS, you can use these steps to do it Steps to file a dispute with SARS
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