IOL Money Issue 3_October 2020

FROM THE EDITOR

AT THE TIME of writing it had just been revealed by the New York Times that US president Donald Trump paid $750 in tax last year, and in many of the preceding years he paid no tax at all. One writer observed that his housekeeper paid more in tax than he did.

Businessmen who wriggle out of paying taxes (usually with the help of devious-minded, high-earning lawyers) are often regarded as folk heroes who “beat the system”. It’s ironic that Trump beat the system that he heads.

The fact is that it is a serious offence to avoid paying taxes, and tax authorities around the world are tightening up on tax avoidance and closing legal loopholes. Tax dodgers may get away with it for a few years, but few get away with it for any length of time, and when they are eventually caught, the massive tax bills and fines they face can be crippling. They may even face jail time.

So, while it is a grudge expense for most of us – especially if you don’t see your tax money being used effectively or efficiently by government, and much of it ending up in the pockets of corrupt civil servants – it is an unavoidable one. The best we can do is reduce our tax liability through legitimate tax breaks, and render what is due unto Caesar without unnecessary fuss or delay.

Among other things, this edition of MONEY provides tips on reducing tax and on filing your annual return in accordance with SARS’s wishes, so as to avoid penalties, fines, or even, in the worst cases, incarceration.

And if you are unhappy about how SARS is treating you, you can lodge a complaint with the Tax Ombud, whose details and services are outlined on page 13.

I hope you find the content useful.

Martin Hesse