SARS new season, what you need to know about it?
With every tax season, small businesses struggle with the arduous task of submitting returns. There are two most important things to note, notably the provisional dates and documents needed to be submitted. This season’s provisional tax season opened on 1st July ending on the 24th October 2022, the shortest to date.
SARS will continue to auto-assess taxpayers and would need to edit and submit their returns online. Moreso for this year’s changes is that the South African Revenue Services (SARS) has gone digital through its eFiling system and SARS MobiApp, allowing users to access their username and password details.
This time the provisional tax season opened on 1st July ending on the 24th October 2022, the shortest to date. Small businesses need to submit if affected by the following:
- Businesses that pay R500,000 in remunerations are expected to register for the Skills Development Levy to the revenue collector.
- Business owners need to produce IRP5 certificates for their employees, a function that the SAGE payroll software used by Axecelerate can make easy.
The South African Revenue Services has undergone an overhaul in its submission process, opting for a more digital and seamless process of submitting tax returns. According to the latest SARS SMME Connect – a recent platform SARS is disseminating information; SARS has been raising awareness for business owners to be tax compliant through their employee information, such as Pay-as-You-Earn (PAYE).
It is important that small businesses also note that the submission of tax returns is required according to their turnover bracket, as “its benefits as well as a quick guide on how to deal with outstanding debt and returns to increase compliance”, says SARS. In addition to this, business owners knowing their company’s turnover will provide an indication of whether your company falls within the provisional tax system, as it is required for the company to be transparent about its profits and how much of its earnings belong to SARS, by submitting an IRP6 return via eFiling.
The failure of a business to be tax compliant may result in a number of consequences, i.e. non-compliance penalties from SARS from outstanding debt, loss in business opportunities and inability to obtain a tax clearance certificate for the business that can indicate what kind of business entity you are, and if at all you need to pay value-added tax (VAT), according to the Income Tax Act.
In the leading, sole traders and partnerships tend to be affected mostly by tax compliance challenges within the small business space. Should you have challenges as a business in understanding compliance, it is important to reach out to a tax practitioner such as Axcelerate and provide the necessary documents for the process to be easy to complete.
There is countless research that indicates that small business owners struggle with compliance when it comes to submitting their returns. This is due to a number of reasons ranging from the cost of tax compliance remains to lack of human and skills to comply. Axcelerate has consultants that can assist using software solutions to streamline the process.