Who’s (Legally) Allowed to File Your Tax Return?

In most countries, all business owners and employees are required by law to file their tax returns at the end of a financial year. For most people, this form of tax accounting can be a daunting task. This is where tax accountants come into play.

Table of Content

• What is a Tax Accounting?
• Who is a Tax Accountant?
• Tax Filling and SARS
• Benefits of Hiring A Professional Accountant
• What you need to Know

Tax Accounting

Tax accounting refers to the methods and policies used for the preparation of tax returns and other statements that determine your level of tax compliance. Tax accounting is viewed as a powerful tool for long-term investment success, however, many small business owners tend to neglect it.

Tax accountants

Tax Accountants are trained professionals who prepare and file tax returns for clients. They file both corporate and individual income tax returns. They are more specialized than general accountants, and many work with businesses that need a full-time accountant, or companies that need specialized tax services. In South Africa, the procedure for filing your tax return with SARS is different depending on whether or not you’re self-employed. If you run a company, then you’ll need to fill out and file a company tax return. If you’re an employee, you’ll need to fill out and file a personal income tax return. Anyone with an obligation to submit their tax returns can legally file their own taxes. Some people think that they don’t have to pay any income tax, but this is not true. If your total income from all sources (including salaries from employers) exceeds a certain amount in a year, then SARS will assess you an income tax liability. The amount of the liability is also influenced by which province you live in.

The South African Revenue Services (SARS).

The South African Revenue Services (SARS) has issued a Circular on the issues that arise when an individual files their own tax return for a business or income-generating activity. The two main issues are:

• Portfolio property (e.g. shares, bonds) and securities accounts can only be filed by an accountant or valuer with appropriate qualifications. The same applies to rental properties, which must be declared in the tax return.
• If you own shares in any company that is incorporated in South Africa (meaning your business is registered with the CIPC), you must appoint an authorized representative who will then be able to file your tax return as your representative.

Although you can submit your own tax returns, it is a good idea to have a professional file them on your behalf. Someone with the knowledge and expertise is bound to save you money, and it will not necessarily cost you much.

Benefits of hiring a Professional Accountant for Tax Filing.

There are a number of reasons why hiring an accountant to file your taxes can be beneficial:

• You can deduct the cost of hiring an expert as a business expense, thereby lowering your taxable income.
• A tax professional has access to resources and information you don’t have to complete your taxes on your own, such as support for specific tax deductions e.g. student loan interest deduction and health savings account or medical aid contributions.
• If you have investments, the tax professional will be able to report those transactions on your behalf, which should save you money on capital gains taxes.
• They can give you a fresh perspective on what you’re doing and explain your tax deductions and credits to you in ways that are easy to understand.
• They can guide you through complicated tax laws, show you how to maximize your returns and help ensure that you’re doing everything properly.
• They can make sure that your return isn’t accidentally filed early, and they can also act as your advocate if SARS doesn’t offer good advice or if they need more information about something on your return.

Here are the facts:

Your tax return can be prepared by anyone that has the education and training to do so. This is most likely going to be an accountant, but it could just as easily be a lawyer or a paralegal. Whatever route you choose, it’s best to go with someone that knows their stuff. In the end, you want someone who’s not only well-trained but can also communicate effectively and provide a reasonable amount of value along the way—whether they’re part of a group or on their own.