Provisional tax – to file or not to file

Have you checked the provisional tax status of your eFiling profile yet? If not, you might be surprised to see that all taxpayers are now loaded as provisional taxpayers i.e. with the ability to submit a provisional tax return. Why is this? SARS issued a media statement last year indicating that one needs only submit a provisional tax return to the extent that one needed to. Come again? Does this mean that if in the first six months you did not earn sufficient interest that one should not submit a first provisional?

One can only imagine the mayhem that will follow when an interest certificate is generated by the bank with a hefty sum of interest (earned in the last six months) and you submit a second provisional return only. How on earth is SARS going to know that the interest was only earned in the last six months? It would also appear that should you become inquisitive and electronically request a provisional tax return, that you are then obliged to submit the return or it will remain as outstanding – not a good thing.

Our advice? Consult or enquire within good time before the next provisional tax submission date (28^th February 2011) to avoid any lengthy and possibly expensive discussions with SARS.