Updated: Jul 25
After the introduction of Auto Assessments last year, SARS have changed certain processes and requirements when dealing with auto assessments, which can be expected as the system evolves.
One important change to this process is that the auto assessment becomes final after 40-working days if you do not submit a revised return. (Auto assessments previously needed to be actively accepted by taxpayers before the became final.)
Corrections after this period will fall into the far more complex and tedious dispute environment.
A notification of an auto assessment should raise the red flag and we urge our clients to contact us (firstname.lastname@example.org) immediately to check the pre-populated information against your factual information.
What is an auto assessment?
Non-provisional taxpayers with a very simple return & have no outstanding historical returns may receive an auto assessment. SARS has received information from 3rd parties (such as employers, banks, retirement fund administrators and medical aids) and have used this data to generate your tax assessment.
Inaction could be costly!
Auto assessments do not take tax-deductible deductions into account.
This includes common deductible expenses such as medical expenses not reflecting on a medical aid certificate, donations to public benefit organisations, travel expenses, home office expenses and wear and tear.
Sars may not have all your information or could possibly have incorrect information.
Good examples of this are foreign income / interest or information from a source with whom your personal details (such as an address) do not match those on record with Sars.
If you do not correct the data or omissions within the 40-day period and your return is selected for audit / verification later on, you will be subject to the same penalties (up to 200%) that would apply for an understatement in your tax return.