Tax season got you stressed? Here’s how to turn SARS into your friend

If you’ve been doom-scrolling through news about SARS’s fancy new artificial intelligence tools hunting down tax dodgers, take a deep breath. Sure, the South African taxman is getting smarter, but that doesn’t mean you need to panic.

Here’s the thing: in a country where only 7.4 million people out of 64 million actually pay personal income tax (while 28 million rely on social grants), SARS is obviously feeling the pressure to collect every rand they can. But instead of running for the hills, why not flip the script and make tax season work for you?

“Whether you have an accountant, a tax practitioner or file your own tax return, look out for the following points to legally reduce what you owe SARS, maximise refunds, and combat tax debt in 2025,” says Roxanna Naidoo, Head of Global Strategy at Latita Africa.

Stop panicking, start planning

“It’s true that SARS is increasing scrutiny and ramping up tax collection measures,” admits Naidoo, who’s been seeing more clients getting those dreaded final demand letters and verification requests lately. “But don’t panic. Tax season is an annual opportunity to assess your finances – a tool for getting your tax affairs in order.”

Her advice? “Go have a look at what you owe SARS; you may be surprised that SARS actually owes you money.”

Plot twist of the year, right?

Get your digital house in order

First things first – update your details on SARS’s eFiling system. We’re talking email address, phone number, banking details – the works. Get this wrong and you’ll be hit with penalties faster than you can say “auto-assessment.”

Plus, having accurate details unlocks SARS’s newer tools like the express filing feature, which basically pre-fills your tax return using data from your employer, bank, and medical aid. It’s like having a personal assistant, except it’s free and works for the government.

Don’t trust, always verify

Here’s where things get interesting. That shiny auto-assessment might look tempting to just click and submit, but Naidoo has a warning: “Don’t simply accept your auto-assessment without verifying it.”

Why? Because SARS’s AI might miss the nuances of your financial life – like rental income, your side-hustle selling succulents on Facebook Marketplace, or other income streams. Even if the mistake isn’t technically your fault, guess who’s liable for penalties later? (Spoiler: it’s you.)

“Check everything carefully,” Naidoo emphasises. “If you’re unhappy with the auto-assessment, click on ‘request amendment’ and submit the corrections via eFiling.”

Turn SARS into your refund machine

Here’s where the magic happens. Yes, you need to declare every income stream – even that cryptocurrency windfall or your overseas earnings that were already taxed abroad. But here’s the kicker: after declaring everything, you can start claiming back through deductions, exemptions, and credits.

Naidoo’s hit list includes:

– Medical expenses
– Retirement annuity contributions
– Charitable donations (with those precious s18A certificates)
– Home office and travel expenses
– Tax-free savings accounts
– Capital gains tax benefits

The paper trail that could save you

Remember that shoebox of receipts gathering dust? Time to become best friends with it. “It doesn’t matter how and where you file these, as long as you keep them for five years,” says Naidoo. “SARS often requests back-dated documentation, so make sure you have the paperwork to prove your filing was compliant.”

Pro tip: go digital. Scan everything, back it up, and thank yourself later when SARS comes knocking with questions about your 2022 filing.

When you actually owe money

If you do end up owing SARS money, don’t sell your kidney to pay them immediately. “Taxpayers have legal recourse to avoid sinking further into debt,” Naidoo points out.

Your options include:

– Negotiating to reduce the amount owed
– Deferring payments to ease cash flow
– Submitting a suspension of payment if you think SARS got it wrong
– Mediation to settle disputes without breaking the bank

The bottom line

“If you’re smart about it, you can still turn this tax season from a compliance burden into financial opportunity,” says Naidoo.

So while everyone else is complaining about SARS’s new AI overlords, you could be the one laughing all the way to the bank – or at least not crying all the way to the poor house.

The choice is yours: stress about tax season or strategise through it. We know which one sounds better.