Edward Kieswetter on expectations for the 2021 tax filing season

The Commissioner for the South African Revenue Service, Edward Kieswetter, recently spoke with CNBC Africa's Godfrey Mutizwa about the expectations and targets for the 2021 tax season. Kieswetter highlighted that the focus during the filing season is not just on collecting additional taxes but on reconciling funds that have already been submitted to SARS through the payroll. He emphasized that last year, SARS paid out more than 29 billion rand in refunds to nearly 2.4 million taxpayers. This year, the trend is expected to continue, necessitating heightened vigilance to prevent refund fraud attempts. Despite the challenges, Kieswetter remains optimistic about the ongoing filing season, with a significant number of submissions already received, including a notable portion through virtual platforms. The shift to remote work due to the pandemic has created new considerations for taxpayers, especially when it comes to claiming deductions for working from home. Kieswetter cautioned taxpayers to carefully evaluate their eligibility for such claims, reminding them that the criteria remain unchanged from before the COVID-19 era. He warned against abusing the provision for home office deductions, as it could have implications on other tax benefits like capital gains provisions. With the mining sector showing positive trends in compliance, Kieswetter expressed satisfaction with the voluntary compliance efforts of large businesses and international companies. However, challenges persist in ensuring compliance among small and medium enterprises (SMMEs), requiring ongoing support and engagement. Addressing the issue of tax morality, Kieswetter noted that taxpayer confidence in the system and the perceived threat of detection play significant roles in compliance. He mentioned a survey indicating an improvement in tax morality, signaling a positive trend. SARS is focused on translating this improved perception into tangible compliance outcomes, including taking decisive action against negligent or deliberate non-compliance. Kieswetter stressed the importance of fulfilling tax obligations and the consequences of failing to do so, which can extend beyond civil penalties to potential criminal charges.