Dirty data trips SARS

By Leon Engelbrecht, ITWeb senior writer

Johannesburg, 01 Sept 2008

Inaccurate data, the problem that earlier this year caused the SA Revenue Service (SARS) to turn the Pay-As-You-Earn (PAYE) income tax system on its head, is still causing the taxman trouble.

SARS this weekend extended the PAYE reconciliation period for employers to 12 September. Spokesman Adrian Lackay at the weekend said the move was triggered by "businesses, some business organisations and tax practitioners who want to comply" having asked for more time.

The previous deadline had been Friday. To assist employers with the reconciliation, SARS has for some months made available free software, support and training to perform the calculations. But some businesses are still daunted.

Lackay says on Friday, for example, the SARS call centre took 40 306 calls, of which nearly half was from employers who needed assistance to do the electronic payroll reconciliation using the e@syFile software.

The tax official adds a second challenge faced by both business and SARS is accuracy of information. "Some tax certificates SARS received do not contain a tax reference number or have a different ID number or name to those on our records. Others show no records at all," he says.

"Before SARS can fill in or 'pre-populate' individual tax returns, we need to be 100% confident that the information is correct."

He says SARS is working with employers, the Department of Home Affairs and other sources to clean up the data "but this process will take time".

Meanwhile, about 130 000 employers have submitted payroll declarations, together with 10 million tax certificates for their employees. More than 26 000 employers submitted EMP501 declarations on Friday alone.

SARS singled out government for its "remarkable response". Government institutions are collectively the largest employer in SA and met their obligation on time "to allow over 1.1 million public servants to enjoy the benefits of a 'pre-populated' return".

While employers have a few more days to get their paperwork in order, employees can from today request a manual customised income tax return as the filing period for individuals gets under way.