Listed below are the tax thresholds for 2022 – and who doesn’t should pay: SARS

The South African Income Service (SARS) has revealed its annual information for the revenue tax season, detailing who is anticipated to pay revenue tax in South Africa and the various kinds of revenue which can be taxed.

Taxpayers will have the ability to file their tax returns from 1 July 2022. People who obtain taxable revenue in extra of a certain amount, often known as the ‘tax threshold’ quantity, in a 12 months of evaluation are responsible for revenue tax.

The tax threshold for the 2023 12 months of evaluation is:

  • R91,250 in case you are youthful than 65 years.
  • If you’re 65 years of age to under 75 years, the tax threshold (i.e. the quantity above which revenue tax turns into payable) is R141,250.
  • For taxpayers aged 75 years and older, this threshold is R157,900.

If you happen to earn under these thresholds, you aren’t liable to pay tax.

To find out whether or not or not your revenue falls underneath or above these thresholds, SARS supplied a breakdown of among the totally different sorts of revenue that a person will be taxed on, together with:

  1. Earnings from employment comparable to salaries, wages, bonuses, additional time, taxable advantages (fringe advantages) and allowances;
  2. Severance advantages and sure lump-sum advantages;
  3. Earnings from a enterprise or commerce;
  4. Earnings or earnings arising from a person being a beneficiary of a belief;
  5. Charges from firms or shut firms for providers rendered;
  6. Funding revenue comparable to curiosity, international dividends and dividends from a Actual Property Funding Belief (REIT);
  7. Rental revenue;
  8. Earnings from royalties;
  9. Annuities;
  10. Pensions; and
  11. Sure capital beneficial properties.

Penalties 

From a taxpayer perspective, the significance of submitting tax returns, particularly inside stipulated deadlines, is supported by the sanctions SARS can impose to the extent that these obligations aren’t complied with, says Tsanga Mukumba, an affiliate at Cliffe Dekker Hofmeyr.

The place taxpayers fail to submit returns by the related deadline, the South African Income Service (SARS) is underneath sure circumstances, empowered to subject an evaluation of the quantity of tax due and impose sure penalties, he mentioned.

“For instance, if a taxpayer fails to submit a return, part 95 of the Tax Administration Act empowers SARS to subject an evaluation primarily based on an estimate, utilizing info available to SARS. Such an estimated evaluation can solely be challenged as soon as the taxpayer has duly submitted the excellent return,” he mentioned.

“Along with with the ability to subject an evaluation which is able to end result within the taxpayer being responsible for quantities of tax, SARS might levy administrative non-compliance penalties underneath part 210 of the Tax Administration Act and understatement penalties underneath part 222 of the Tax Administration Act.”

Mukumba famous that SARS might impose an administrative non-compliance penalty when a taxpayer has didn’t adjust to their obligation to submit a return. These penalties are imposed for each month throughout which the non-compliance persists.

He added that the quantity of the penalty relies on the taxpayer’s assessed loss or taxable revenue for the previous tax 12 months.

“The place a taxpayer has an assessed loss, every month-to-month administrative non-compliance penalty could also be R250, whereas the place a taxpayer has taxable revenue of R50,000,001 or extra, the penalty could also be R16,000 per thirty days.

“SARS is equally empowered to impose an understatement penalty, the place the non-submission of a return has prejudiced SARS or the fiscus and resulted in a shortfall.”


Learn: SARS is altering auto-assessments for taxpayers – what it’s best to know

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