Auto-Assessments – All you need to know...
Requirements to qualify for an Auto-assessment and the process to be followed:
An auto-assessment is an option exercised by SARS if they believe that your taxable income and related expenses can be determined and calculated from the submissions received from your employer, medical schemes, banks, retirement fund administrators, financial institutions from whom you may have earned interest, and other third parties that are required to submit information to SARS relating to your income to populate your Tax Return (ITR12) on SARS e-Filing.
This year from the 7th of July 2025, SARS will again issue auto-assessments to taxpayers whose tax affairs are less complicated. If the taxpayer is in agreement with the auto-assessment, there is no need to take action to “accept” the assessment.
SARS will issue the assessment to you via eFiling or the SARS MobiApp. At the same time, the taxpayer will receive a message via their preferred channel of communication, e.g. SMS or email, to inform the taxpayer that their assessment is available for them to view on eFiling or SARS MobiApp.
In most instances these auto-assessments are accurate and provide a true reflection of the taxable
income and the tax payable or refundable by or to the relevant taxpayer.
When are these Auto-assessments generated?
The auto-assessments for the tax year ending the 28th of February 2025 will be generated between the 7th and the 20th of July 2025.
How are Auto-assessments communicated to the taxpayer?
Taxpayers will be informed of the auto-assessment by way of an e-mail or SMS once the auto-assessment has been generated.
How is the Auto-Assessment for the 2025 tax year different from previous years?
In previous Tax years, a taxpayer had 40 days from the date of the auto-assessment to file their own return. From the 2024 tax season going forward, SARS has agreed to extend the submission date to the same date as that for salaried employees, which means that the deadline for the submission of returns for auto-assessed taxpayers is also the 20th of October 2025.
Only if an auto-assessment has been issued by SARS after the deadline of the 20th of October 2025, will the 40 business days start from the date of the notice of the assessment.
Acceptance of the Auto-Assessment
If the taxpayer is in agreement with the auto-assessment, there is no need to take action to accept the assessment. If a refund is due, payment from SARS can be expected within approximately seventy-two (72) hours of the Auto-Assessment Notice being issued, provided the taxpayer’s banking details with SARS are correct. If an amount is owed to SARS, payment can be made via eFiling or the SARS MobiApp by the payment due date indicated on the “Notice of Assessment” (ITA34).
In the event that SARS process a refund to a taxpayer before the taxpayer has had the opportunity to reject the auto assessment and submit an amended return if additional income or deductions are to be declared, the taxpayer can still submit an amended return when tax season opens on the 7th of July 2025. SARS will subsequently issue the taxpayer with an amended assessment (ITA34) which will reflect the adjusted tax refund or the amount of tax payable.
Rejection of the Auto-Assessment
If the taxpayer is not in agreement with the auto-assessment issued by SARS, the taxpayer would need to reject the assessment and file an amended return any time after the 7th of July 2025, when the Tax Season opens, but no later than the deadline of the 20th of October 2025.
Is it advisable to merely accept an auto-assessment?
In our opinion there are a number of reasons why taxpayers should be aware of the downside in merely accepting an auto-assessment without giving due consideration to the possible risks involved.
These considerations can be summarised as follows:
- Failure to declare all income and expenses - as mentioned above, no action is required by a taxpayer to accept the auto-assessment issued by SARS, which could give rise to taxable income or deductible expenses being overlooked in the acceptance thereof. However, should an auto-assessment be accepted and the taxpayer has failed to declare all relevant income and expenses (e.g. Rental or business income), SARS could levy a penalty of up to 200% of the tax payable inclusive of interest should the failure to disclose all income and expenses be uncovered during a subsequent audit;
- Not claiming for deductions - The taxpayer could forfeit the opportunity to claim deductible expenses such as home office expenses, medical expenses, travel expenses, etc. as these would not have been automatically included on the ITR12;
- Omitted or Outdated Tax Certificates - Some of the taxpayer's tax certificates may have gone astray and subsequently have not been populated on the ITR12 on SARS e-Filing which may have various consequences, or alternatively, the certificates may not be fully up to date.
Taxpayers should therefore consider and ensure full compliance before accepting an auto-assessment, especially in view of the fact that acceptance of an auto-assessment requires no confirmation or action on the part of the taxpayer.
We're Here to Help
At Dynamic Business Solutions, we have many years’ experience dealing with SARS and are Registered Tax Practitioners with the entity. If you have received an auto-assessment, have any questions or need help, contact us today.
