SARS: Celebrating and consolidating our freedom

This Freedom Month is about “consolidating and safeguarding our democratic gains.”

It is also an opportunity to reflect on the impact of adhering to your tax obligations as it contributes to optimal revenue collection and improvement of the quality of life for all citizens.

Over the last few years, SARS has made great strides in revenue collection that enables Government to provide services to the public and citizens, especially in historically disadvantaged communities.

The gross tax revenue of R2,068 trillion for the 2022-23 financial year represents a year-on-year growth of 9.7%. This is a milestone achievement where SARS has exceeded R2 trillion in gross revenue for the first time in our 25-year history.

As we continue to do the right thing by paying our taxes, we should be reminded that tax compliance is aligned with the Bill of Rights as enshrined in the Constitution.

Some of the rights that tax compliance upholds and promotes include the following:

• The right to privacy, as envisaged in section 14 of the Constitution.

• The right to information, as envisaged in section 32 of the Constitution, is read with the Promotion of Access to Information Act, 2000 (PAIA).
• The right to just administrative action as envisaged in section 33 of the Constitution, read with the Promotion of Administrative Justice Act, 2000 (PAJA).
• Every adult citizen has the right—
  • (a) to vote in elections for any legislative body established in terms of the
  • Constitution, and to do so in secret; and
  • (b) to stand for public office and, if elected, to hold office.

SARS is cognisant of all these rights and ensures that they are upheld and promoted in our interaction with taxpayers.

Employer Filing Season

Filing Season 2023 for employers opened on 1 April and will close on 31 May this year. Employers are required to file their Annual Reconciliation Declaration (EMP501) during this period, reflecting accurate payroll information about their employees, employees’ tax (PAYE) payments made, and Tax Certificates (IRP5/IT3) (a)s generated, covering the full tax year from 1 March 2022 to 28 February 2023.

As an employee, ensure that your employer provides you with an IRP5 that has been submitted to SARS. If not, you will have difficulty submitting your own personal Income Tax return later in the year.

 Providing Clarity & Certainty

To make it easy to reconcile, SARS provides information and guidelines that are simple and clear (more info on the SARS website: www.sars.gov.za).

This includes the following:

• Employers, Tax Practitioners and Payroll Administrators need to download the latest e@syFile™ version via the SARS eFiling website.
• Employers must submit outstanding monthly declarations (EMP201) and annual reconciliations (EMP501) to SARS prior to submitting the EMP501 for 2023.
• Employers must register employees for income tax purposes using Single (“Individual ITREG”) and bundle IT Registration (“Bundled ITREG”) for existing tax numbers as well as new registrations available on e@syFile™.

Submission channels

Employers with up to 50 employees have a choice between using SARS eFiling or SARS e@syFile™. But Employers with more than 50 employees must use SARS e@syFile™.

Penalties for Non-Compliance

An employer who files EMP501s late will be penalised under the provisions of paragraph 14(6) of the Fourth Schedule to the Income Tax Act, where the penalty will be equal 1% of the year’s PAYE liability, for each month that the return is late and increment up to 10% of the year’s PAYE liability.

Regional News

The regional leadership and staff of SARS would like to thank the residents and businesses of the Gauteng South region for their compliance (the region excludes Pretoria, central Jhb and Soweto). As a result of your commitment and compliance, the region was able to contribute in excess of R175bn (nett) to the fiscus in the last financial year. We returned just under R25bn in refunds back to the economy. A little over R5bn was put back into the pockets of Individual taxpayers and the rest went to our valued businesses in the region.

SARS, however, is cognisant that there are still some businesses operating in the region which are not compliant. SARS is able to identify a few of these businesses last year and engaged the SAPS and Home Affairs departments to partner with us to enforce the law.

SARS intends to double our efforts to identify the remaining non-compliant businesses in the region this year and make it hard and costly for them to remain non-compliant.

SARS is appealing to all those who wish to get their tax affairs up-to-date to make contact with us. This you can do via your nearest branch or via any of our digital channels.

It is best if you approach us before we identify non-compliance. You can also visit our website or engage your tax practitioner to see how you can leverage SARS’ very generous Voluntary Disclosure Programme as a route to normalising your tax affairs.