SARS are increasingly requesting supporting documents to be submitted by taxpayers to verify their tax returns submitted via e-filing. In the past this used to be the exception rather than the rule but it has now become the rule! This verification involves an electronic upload of the taxpayers’ supporting documentation backing up the information submitted to SARS on the actual tax return. For example, interest earned and disclosed on the return needs to be backed up by IT3b’s from the various financial institutions. As SARS’s systems for the electronic exchange of information with employers and financial institutions becomes more sophisticated, it is essential we are given the correct and complete information to prepare a tax return. If we don’t get all the information and SARS do, this often results in further queries from SARS and can lead to a full audit of a taxpayer’s return due to an omission from the tax return.
SARS are particularly strict in two areas at the moment – firstly detailed logbooks reflecting the name of the client and distance travelled on each business trip being submitted where motor vehicle travel expenses are claimed; secondly full proof of all medical expenses incurred and proof that they have actually been paid by the taxpayer claiming the rebate by submission of bank statements reflecting this.
All of the above generally results in delayed refunds to the taxpayer where they are due. This adds further weight to the importance of ensuring the correct information is submitted on the tax return plus the correct supporting documentation is at all times available to back up this information. Should those of you whose returns we complete be unsure of what is required please do not hesitate to speak to us.
