12 Top Tips to Help You Understand Tax

How the Work-from-Home Culture Impacts Your Tax Return

The shift to a work-from-home culture due to the pandemic has brought up new questions about taxes, expenses, and deductions. In this article, we'll explore how the new work environment affects your tax return and what you need to know to stay on top of your taxes.

As a responsible citizen, it's important to understand and stay up-to-date with tax rules and regulations. The South African Revenue Service (SARS) has made submitting tax returns for individuals and organisations easy and accessible, so you have no excuse for ignorance. Understanding tax is a key way to better manage your finances and avoid financial distress in the future.

When it comes to tax returns, it's crucial to stay organised and have all the necessary supporting documents ready, such as:

• IRP5
• IT3(b) - summary of interest and dividends earned
• IT3(c) - summary of sales of investments
• IT3(s) - summary of interest and dividends earned on tax-free savings account
• Medical Aid Certificate
• Logbook for business and personal travels
• Section 18A Certificate for donations
• Relevant invoices and statements
• If you're submitting your tax return using E-Filing, SARS provides a helpful video guide to get you started.

Boost Your Tax Savings with These Overlooked Deductions

You can save money on your taxes by taking advantage of certain deductions, such as contributions to pension, provident, and retirement funds (up to 27.5% of your gross remuneration, with a yearly limit of R350,000). Donations to registered charities are also tax-deductible (up to 10% of your taxable income). SARS also provides tax relief for tax-free savings and investments, with a yearly limit of R36,600 and a lifetime limit of R500,000. Additionally, you can claim tax credits for medical aid expenses, with a primary member deductible of R332 per month and R224 for each dependent.

Finally, it's important to keep track of medical expenses not covered by your medical aid, as they may be eligible for tax deductions. For more information, check out the SARS E-Filing guide available.

In conclusion, the shift to a work-from-home culture has brought new considerations for taxes and expenses, but with the right information and preparation, you can minimise your tax liability and keep your finances in order.