You most probably won’t allow a non-qualified person to conduct dental work on your teeth and most certainly won’t attempt to fix a major dent in your vehicle’s door if you don’t have any training in doing so. Getting help on how to effectively manage your tax returns thus makes sense. However, the professional help you think you get may not always be to your advantage.
Many tax payers have been financially hurt by tax practitioners who have not been qualified and don’t act ethically in their dealings with SARS. Some more people have suffered financial losses because they have trusted friends to manage their tax returns. It’s for this very reason why you should always make use of a registered tax consultant.
Some practitioners make promises of getting amazing refunds for their clients. They then proceed to claim deductions that don’t exist or inflate the amounts. This then leads to payouts from SARS, but eventually the fraudulent practices catch up to the practitioners and, unfortunately for the clients, they have to do the explaining since they are held responsible for all information listed on their tax returns. It is thus imperative to select tax practitioners that are well-qualified and who are known for acting ethically and who are following the codes of good practice also in tax reporting.
The mistakes made by tax practitioners lead back to their clients. At the end of the day, the clients are responsible for penalties, late submissions, incorrect information supplied and money owed. Where clients make use of tax practitioners with less than desirable track records with SARS, they also risk coming under the radar of the tax man.
With the SARS eFiling system, which is widely used by South African tax payers, people can now manage their own tax returns. The system works quite well for the average salary worker where many of the fields on the form are already populated. With such, tax payers are able to get a better understanding of their financial matters and how to reduce their tax exposure legally. In addition, the tax payers able to do so, can save money on tax consultancy fees. It therefore makes sense for many people to handle their own tax returns.
The above being said, the risk of getting it wrong on the forms is a reality and when doing so, the mistakes can be big. One of the areas where people often err is that of disclosing information in the wrong fields. They, for instance, make the mistake of completing the form with after-tax-payment information in the field of income before tax has been deducted. This leads to another levy on their earnings.
The relatively low cost associated with having the tax returns managed by a professional tax practitioner in comparison with getting assistance from one to fix your errors is something to consider. Doing it right the first time around by getting professional help is one sure way how to effectively manage your tax returns.
If you, for instance, have high interest earnings then the tax practitioner fee that can be deducted from tax payments is certainly worth the while. Also consider that tax practitioners already understand the SARS procedures and the language used. They are familiar with statutory requirements, keep up to date with tax tables, and keep track of when to and how tax returns must be submitted and payments made.
They remind you of when it is time to complete the forms, help you to ensure that the correct fields are completed, and handle the complicated calculations. All of these things take time, accuracy, expertise and training.
They are well-informed about allowable deductions and areas where you may not even consider claiming deductions they will be able to identify. They can help with the difference between profits and sales if you are a small business person and can help with understanding how to complete the actual expenditure on the eFiling system and help you understand the benefits of keeping a logbook.Unless you are a professional tax consultant, you will consequently benefit from the expertise offered by our tax consultants on how to effectively manage your tax returns.