6 things to look for on your 2023 SARS auto assessment

2023 tax season is very nearly upon us and one of the ways it will be made “easier than ever before,” according to tax authorities, is the 2023 SARS auto assessment.

Only certain taxpayers will be illegible for this and if you are one of them, you will receive a notification via SMS or email between Friday June 30 and Thursday July 6, 2023. This is ahead of the official opening of the 2023 tax season on Friday 7, 2023.

ALSO READ: 2023 tax season will be ‘smoother than ever,’ says SARS

However, we wanted to know if there were any risks to the 2023 SARS auto assessment process, whether it could negatively impact your tax refund, and what the recourse is if the auto assessment is incorrect?

We chatted to Taxtim for some specialist advice. Here’s everything you need to know about accepting or rejecting your 2023 SARS auto assessment.

1. HOW DOES SARS DECIDE WHO IS ILLEGIBLE?

It’s not about illegibility, a SARS auto assessment is issued automatically to certain taxpayers if data from employers, financial institutions, medical schemes and third-party data providers means it can generate an assessment without any input from the taxpayer.

ALSO READ: FAQ: Tips to submit your 2023 SARS tax return

If you do get one, the deadline is the same as the tax season – 23 October 2023 – and is not limited to 40 business days as it was in 2022.

2. SHOULD I ACCEPT THE 2023 SARS AUTO ASSESSMENT?

Taxtim says there are risks involved and insists that you should not simply accept it for convenience sake. You MUST check it carefully before accepting or rejecting. The truth is, because it is automatically generated, it may be inaccurate.

3. WHAT COULD BE WRONG ON IT?

It may not have all of your tax certificates or your most up-to-date tax certificates. It may be missing certain deductions, like travel claims, a home office, donations to charities, travel expenses and medical expenses. These omissions could result in you paying more tax than necessary.

Everyone’s tax affairs are different, but Taxtim offers a useful auto-assessment decision tree to help you through the process, click on it HERE for advice.

4. WHAT IF I REJECT THE 2023 AUTO ASSESSMENT?

If you don’t agree with the SARS auto assessment, no stress, there are no penalties. You simply reject it and submit your tax return as you would normally do via eFiling or through the handy SARS MobiApp.

As with the auto assessment, you have until 23 October 2023 to do this. Taxtim says, If you have complex tax profile, doing a traditional return will allow you to complete your deductions, pay less tax and therefore maximise your chances of a refund.

5. WHAT HAPPENS IF IT’S INCORRECT BUT I ACCEPT IT ANYWAY?

This is SARS, and not even their own processes will make you exempt from penalties or legal action. It is your responsibility and yours alone to ensure you report all income and expenses accurately to SARS.

6. WHAT PENALTIES WILL I FACE FOR AN INACCURATE RETURN?

If it turns out the SARS auto assessment you submitted was incorrect, you WILL NOT be exempt from penalties/legal action. SARS can levy a penalty of up to 200% of the tax payable plus interest. And SARS will most likely want to audit you to verify any discrepancies.

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Taxtim reiterates, whether through the 2023 SARS auto assessment, eFiling or MobiApp, you must not attempt to inflate your expenses and under-declare your income, as this will make you potentially guilty of fraud.

This article is for informational purposes only and should not be construed as financial, tax or legal advice. For further details consult SARS the website or get in touch with a tax specialist.

Original article by Ray Leathern.