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The South African Revenue Service (SARS) has announced several important updates and changes for the 2024 Personal Income Tax Filing Season. These include adjustments to the format of tax forms, updates on solar and renewable energy claims, pro-rata adjustments for certain deductions, and the introduction of the two-pot retirement system.

Auto Assessments:

The Personal Income Tax phase of Filing Season 2024 commences with the issuing of auto-assessments from 1 July 2024 up to 14 July 2024.

Taxpayers who agree with their auto-assessments can file a tax return immediately, while all other taxpayers will be able to do so from 15 July 2024 onwards, with the exception of Trusts, which can do so from 16 September 2024 onwards.

It is crucial for taxpayers and clients to consider their auto assessments carefully. Do not accept the auto assessment until you have consulted with your tax practitioner and are completely satisfied that all allowable deductions and income have been accurately accounted for and that the SARS assessment is correct. We strongly urge you to contact us to assist with the calculations.

Key filing dates:

Auto Assessment Notices  1 to 14 July 2024
Individual Taxpayers (Non-Provisional)  15 July 2024 to 21 October 2024
Provisional Taxpayers  15 July 2024 to 20 January 2025
Trusts  16 September 2024 to 20 January 2025

 Important updates:

Pro-Rata deduction for retirement fund contributions:

The allowable retirement contribution deduction will be adjusted pro rata if the assessment period is less than 12 months.

Exemption for tax-free investments:

The contribution limitation for tax-free investments will be adjusted pro rata for assessment periods less than 12 months.

Urban Development Zone building deductions:

Deductions for buildings in urban development zones have been extended until 31 March 2025.

Solar energy tax credit:

A solar energy tax credit was available for new and unused solar PV panels brought into use from 1 March 2023 to 29 February 2024. The credit is 25% of the cost, up to a maximum of R15,000.

Renewable energy tax incentive:

Businesses can deduct 125% of the cost of eligible renewable energy assets upfront. This incentive applies until 1 March 2026.

Two-pot retirement system:

The two-pot system allows for a portion of retirement savings to be accessible before retirement while the remaining funds are preserved until retirement. This change aims to provide taxpayers with flexibility and financial security.

ITR12 (Individual Income Tax Return) form changes:

The form has been redesigned to simplify the process of claiming foreign employment income exemptions and ensure the correct declaration of beneficial owner details.

Please ensure that all information submitted is true and accurate.

If you need any assistance or further information, please contact us.

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