South Africa

Taxable period

The tax year for individuals ends at the end of February. In exceptional cases accounts may be drawn up to a different date. Spouses are taxed separately and must submit separate returns.

Tax returns

The date for the filing of returns is fixed each year by government notice. Individuals with a single source of taxable employment income below ZAR 500,000 do not need to submit tax returns.

SARS also issues auto-assessments to certain individuals calculated using data received from employers, medical schemes, banks, retirement annuity funds, and other institutions. If the taxpayer is in agreement with the auto-assessment, no further action is required in the case of a refund due, while payment must be made before the due date if owing SARS. The taxpayer must complete and file a tax return if not in agreement with the auto-assessment. The date for the filing of the return is fixed by government notice.

Payment of tax

Pay-as-you-earn (PAYE) WHT is withheld on remuneration for employment. Where PAYE deductions are made from remuneration, these deductions constitute nothing more than advance payments toward the liability for normal tax.

Individuals earning non-remuneration income are required to register as provisional taxpayers and must make two provisional tax payments per year, the first by the end of August and the second by the end of February, based on an estimate of taxable income for the year.

Tax audit process

There is no prescribed audit process and an audit can be initiated by any factor as determined by SARS. The audit or inspection will commence with a request from SARS for the taxpayer to make available any such records or information as may be required.

Statute of limitations

Tax debts to the state prescribe after a period of 15 years. Submitted tax returns that have been assessed may not be reopened after a period of three years from date of assessment unless there has been fraud, misrepresentation or non-disclosure by the taxpayer.

Topics of focus for tax authorities

High net worth individuals and trusts are currently a focus of SARS, as well as automatic exchange of information between tax authorities. Since October 2021, SARS has appointed a new director of its unit for high net worth individuals to renew its focus on conducting investigations into individuals and families, as well as commencing lifestyle audits for individuals.