What Is an Auto-Assessment?

When a taxpayer is auto-assessed, SARS uses the information they already have from third-party data providers (like your employer, banks, and medical aids) to pre-populate and submit a tax return on your behalf.

Sounds great, right? Less admin for you! And in many cases, it is. But here’s why we think you shouldn’t just accept the auto-assessment and move on.

1. It Might Be Inaccurate: While SARS does its best, the information they have might not be 100% complete. For instance, allowable deductions such as wear and tear, travel expenses or medical expenses paid out of your own pocket are most likely going to be omitted from the calculation because SARS does not have access to this kind of information. If you don’t claim these deductions, you might end up paying more tax than you’re supposed to or miss out on getting a refund if you qualify for one.

2. Potential penalties and interest: If your auto-assessment is incorrect and leads to an underpayment, you might end up paying penalties and interest for understating your tax. The onus is on you as the taxpayer to ensure that all your income and deductions have been accounted for.

3. Limited Time to Act: You don't have forever to accept or dispute an auto-assessment. SARS provides a specific window during which you can review, edit, or decline the auto-assessment. If you miss this window, you might have to go through a more complex objection process.

Fortunately, we are here to assist you during this tax season as your trusted tax practitioners.