By John Manyike

For many of us, tax return time is a worrying period involving deadlines and admin, avoiding penalties, and ensuring that our returns are accurate. Then, with fingers crossed, if we are using e-Filing, we click a mouse and send the return on its way, hoping that a refund is in the air.

Although the November 23 deadline date for individual taxpayers may seem far away, now is the time to get to know and understand e-Filing, which has been a personal tax game changer and made dealing with the taxman as easy as logging on to a site and registering, and being able to submit returns, and view personal tax status 24 hours a day without leaving home.

For those with simple tax affairs, e-Filing has opened up the world of automatic assessments. Sars does the assessment work and issues automatic assessments based on data collected from employers, financial institutions, medical schemes, retirement annuity fund administrators, and other parties. For those taxpayers who are auto assessed, the only time a return must be submitted is if you believe they got something wrong.

But whether you have to submit a return or are happy to accept an automatic assessment, it still pays to be prepared if you want to ensure you pay what you need to and nothing more.

Understanding what’s required, getting organised, and keeping all the necessary documents, income information, expense receipts, log books and investment records in one place throughout the year can significantly reduce headaches and stress.

Knowing your tax status is equally important. For instance, if you’re a provisional taxpayer, the rules and submission dates are different, and any mistakes could result in penalties. Knowing these factors can help you navigate the tax filing process more effectively.

The things you should know are:

· Your tax bracket. This information is easy to use to check that you are paying what is due.

· The allowances that Sars permits for different classes of taxpayers. Tax is payable once you earn over R95 750 and are under 65. If you are 65 or older but younger than 75, you only pay tax on amounts over R148 217.

· You can claim deductions and rebates for retirement annuities, pension fund repayments, medical aid, other medical expenses, and donations to Sars-registered charities.

· If you work from home from a dedicated space you might be able to claim certain expenses from Sars.

· If you have a rental income and you incur some losses, you can claim some of these losses from Sars e.g. bond interest, property repairs, agent’s’ fees, insurance, rates, and taxes etc.

As a nation, we don’t make enough provision for our futures by saving and contributing to retirement funds. Saving and building up funds for a secure retirement offer tax breaks and are good ways of reducing tax and possibly earning refunds. These include:

· Making contributions to retirement schemes. Tax deductions of up to 27.5% are allowed on income or salary of up to R350 000 a year for pension, provident or retirement annuity (RA) funds during the year.

· Having tax-free savings accounts. No tax is paid on the growth of investments, and the money stays tax-free even if you withdraw it from the account.

· Tax credits are allowed for belonging to a medical aid. Fixed monthly credits cover the fund’s main member, a spouse, and dependants.

· Keeping a logbook if you get a travel allowance. If you record your business mileage, you can claim a travel deduction and reduce the tax owed. If you drive a company car, keeping a logbook to record business mileage can reduce your tax.

· If you are a commission earner, you can deduct all commission-related expenses against your commission income. You can claim for telephone, stationery, and business travel costs, but you should ensure that all the expenses and invoices are kept to back up claims.

· If you are self-employed, you can deduct all your business-related expenses against your business income. Again, records and invoices must be kept.

Although e-filing has changed how we deal with our taxes, taking advantage of the smart tax payment option also means being a smart taxpayer. Planning and being aware of deadlines and opportunities result in tax savings.

Being informed about tax matters will help you maximise your refunds. If necessary, getting professional help will ensure taxes are filed accurately and on time so penalties and interest charges are avoided. Tax season should be just another routine yearly event rather than a time of stress.

* Manyike is the head of financial education at Old Mutual.

PERSONAL FINANCE