SARS readies for 2008 tax season

By Leon Engelbrecht, ITWeb senior writer

Johannesburg, 04 Apr 2008

The SA Revenue Service (SARS) believes its billion-rand investment in IT has paid off. The taxman has handed National Treasury record revenue and expects even more this year as e-filing gains in popularity among the public and tax practitioners.

Finance minister Trevor Manuel on Tuesday announced SARS had collected a preliminary R571.8 billion for treasury in tax year 2007/8, which ended midnight on 29 February. The result was R0.8 billion above his February 2008 budget estimate, and R15.2 billion more than he in February last year expected SARS to collect.

SA has about eight million registered taxpayers, a number that excludes those who Pay as You Earn, and over a million of them submitted returns by e-filing, says Mark Kingon, SARS GM for operational support. He adds that a million more submitted returns by various other electronic means.

About 897 000 individuals submitted returns using e-filing and about 120 000 companies, trusts and tax-exempt entities also filed income tax returns using the e-filing facility.

"SARS is happy, in fact, extremely happy, with the take-up," Kingon says. E-filing replaces a million documents that would normally float around [our offices] with supporting documents," he adds, further saying that the difference is telling.

Kingon says SARS is encouraging more taxpayers to use e-filing for the upcoming tax season because it is "far more secure and far more cost-effective for the taxpayer and SARS".

SARS spokesman Adrian Lackay adds there are some constraints. "We would as like as many people as possible to use it, but we have to be mindful of the SA context that speaks to Internet access, as well as computer and tax literacy," he says. "Tax literacy is low and many people don't know what they can deduct and what they can't."

Lackay adds that people needing assistance can go to any SARS office, where staff will help them complete their e-filing.

Kingon says the biggest challenge this year will likely be taxpayers forgetting their passwords. Although people can reset passwords online, he says many instead chose to phone the SARS contact centre. Another problem is the tendency of taxpayers to delay to the last moment.