With over 5,8-million South Africans auto-assessed by SARS in July alone, tax experts are warning that many taxpayers may have unknowingly accepted incomplete or incorrect tax returns, potentially putting themselves at risk of penalties, refund reversals, or future audits.
TaxTim explains that SARS introduced the auto-assessment system to streamline tax season and reduce the need for manual submissions.
For many salaried taxpayers with straightforward financial situations, this system works. However, for many others, particularly freelancers, landlords, commission earners, or individuals with multiple income streams, accepting an auto-assessment without careful review could mean missing out on crucial deductions or failing to declare income that SARS doesn’t automatically pick up.
“It’s not that you purposefully do something wrong,” says Nicci Courtney-Clarke, chief operating officer of TaxTim, “It’s that SARS doesn’t always have your full story. If you don’t check and submit your own tax return for income and/or expenses which may be left out, you’re taking full responsibility for what’s missing, and SARS will hold you accountable.”
SARS paid out over R10,6-billion in tax refunds in July — but these were based only on preloaded data from third parties, like employers, banks or investment platforms. This data doesn’t always provide a complete picture of taxes.
In many cases, taxpayers who rushed to accept their tax refund may have overlooked declaring rental income, freelance payments, or capital gains. Others may have missed out on claiming valid deductions like medical expenses, travel reimbursements, or contributions to retirement annuities made after SARS’ data cut-off date.
The result? A growing number of taxpayers may face additional assessments, interest, and penalties, or have their tax profiles flagged as SARS conducts post-submission checks later in the season.
Courtney-Clarke warns: “It might clear at first, and you might even get a refund. However, if SARS identifies a discrepancy later, even a minor one, they can reverse your refund, issue a new assessment, or initiate an audit. That’s not something most people want to experience.”
What makes the issue more concerning this year is how seamless SARS has made the process. Auto-assessed taxpayers receive an SMS or email stating they have received an assessment (ITA34). If the taxpayer agrees with the ‘original estimate assessment’ that appears in eFiling, no further action is required.
If the taxpayer disagrees, then they need to click the button to Request Return to open and complete a tax return. But TaxTim warns that the convenience comes with responsibility.
Courtney-Clarke, “Just because it looks official doesn’t mean it’s complete. If SARS didn’t receive your medical certificates in time, or your RA contributions from July weren’t on file yet, or you earned income from an online gig that a third party didn’t report, it won’t show up on the SARS system. But you’re still expected to declare it.”
This year’s risks are further highlighted by recent tax directive errors affecting pension fund data. TaxTim explains that a tax directive error by a certain fund caused some retirement lump sum transfers being taxed incorrectly. For affected taxpayers, this may result in a false tax debt appearing on their auto-assessment — showing the lump sum as taxable when it should not be.
TaxTim has already seen cases where users left their auto-assessment unchanged and were later contacted by SARS for supporting documents or advised of additional tax due. While this can often be corrected, it creates unnecessary stress. It can delay the finalisation of a return — especially if a taxpayer has already spent a refund they weren’t entitled to.
Fortunately, there are ways to correct the situation. Taxpayers who don’t agree with their auto-assessment have until 20 October 2025 to submit a corrected tax return. Filing now with accurate information is the best way to avoid penalties, interest, or disputes later.
“There’s no shame in submitting your own tax return instead,” concludes Courtney-Clarke. “It’s often the responsible thing to do. But there can be real cost, financial and legal, in leaving the auto-assessment untouched when you know something’s not right.”