Just because the 2020 tax return season has been delayed, it doesn’t mean your refund has to be – get the ultimate 2020 tax return checklist

Just because the 2020 tax return season has been delayed, it doesn’t mean your refund has to be – the ultimate tax return checklist

Chanel Raath (Interim Head of Cornerstone Tax and Accounting Services)

Normally, the tax return season would be kicking off soon, but due to the impact of the COVID-19 pandemic, it has been postponed until 1 September 2020. Although this delay is inconvenient for most, it has a positive angle as well – it gives you more time to ensure all your tax returns documents are ready, correct and updated. This will allow your tax returns to be done quicker and ensure your refund pays out faster.

Contrary to popular belief, tax returns don’t have to be as complicated and stressful as many perceive it to be. To get you going, Cornerstone Tax and Accounting Services has put together an easy to use checklist to help you keep track of these documents and tackle your tax returns with confidence.

New mimimun threshold for tax return requirements

If you earn less than R500,000.00 per year, before tax, you do not have to submit a tax return.  However, over and above the income threshold, you also need to meet the following criteria to be exempted form submitting a tax return:

  • Your total employment income for the year before tax is not more than R500,000;
  • You only receive employment income from one employer for the full tax year;
  • You have no other form of income, such as car allowance, business income, rental income, taxable interest or income from another job; and
  • You don’t have any additional allowable tax related deductions to claim, such as medical expenses, retirement annuity contributions and travel expenses.

Your IRP5

Your IRP5 indicates your annual taxable income and any deductions from your salary, whether it be via your employer or other external deductions. Nine out of ten times your employer will provide you with your IRP5, however you can also get it directly from SARS’s website using your e-filing profile.

Medical aid tax certificate

If you belong to a medical aid, a portion of your monthly contributions is tax deductible, but to claim it you need a medical aid tax certificate. In most cases, your medical scheme will provide you with your tax certificate pro-actively prior to tax season opening.

Your pension fund, provident fund or retirement annuity (R/A)  contribution information

All pension and provident funds as well as retirement annuity (RA) contributions are tax deductible, up to 27.5% of your annual taxable income (max. annual contribution of R 350,000.00). Here, there are two ways in which you can get a tax return:

  • Pension or provident fund and R/A contribution via your employer/payroll

If your pension or provident fund contribution reflects on your payslip or IRP5, you will not receive a tax certificate from your provider when submitting your tax return. This is because you are already receiving the tax deduction benefit each month. In other words, you are still getting the same tax benefits, but instead of a lump sum each year, you receive it monthly.  

  • R/A contributions in your personal capacity

If you contribute to a R/A each month in your personal capacity, you will need a tax certificate from your provider to receive your lump sum tax return. Most providers will proactively send you your tax certificate, but if they don’t you can simply contact them and request it.

Tax certificates from any NGO’s that you have donated to

All donations to registered NGO’s are tax deductible up to 10% of your annual taxable income. For you to get the tax benefit from these donations, you will have to submit a tax certificate indicating the amount you donated as well as the NGO’s registration number.

Log book for travel claims

If you receive a travel allowance from your employer, or if you travel a lot for work, you may qualify for travel claims. It is vitally important that you keep a log book that includes the following information:

  • Kilometres travelled (weekly odometer readings would suffice)
  • The amount you spent on fuel, the dates you purchased fuel and the odometer reading on those dates as well as all fuel purchase receipts.

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