By Katlego Mei, CFP ®

Tax season can feel complicated in retirement, especially when your income comes from several sources. A careful review before submitting your return can help you avoid delays, reduce the risk of an incorrect assessment, and make sure you do not pay more tax than necessary.

For South African retirees, the key is to confirm that SARS has the correct information about your income, deductions, medical expenses, and personal details.

Check all sources of income

Start by reviewing every source of income you received during the tax year.

This may include pension income, living annuity payments, interest from bank accounts, investment income, taxable retirement fund withdrawals, rental income, or earnings from part-time work.

If you received income from more than one source, gather all the relevant tax certificates before you file. Compare the figures on those certificates with the amounts reflected on your SARS return.

A missing or incorrect certificate can affect your assessment. It may reduce a refund or leave you with an unexpected tax bill.

Do not assume that all information has been captured correctly. Even where SARS has prefilled your return, you remain responsible for checking the details.

Review retirement-related documents

Retirement fund transactions can have a significant effect on your final tax calculation.

If you still contribute to a retirement annuity, keep your contribution certificate and confirm that the correct amount appears on your return. Qualifying contributions may reduce your taxable income, subject to the applicable limits.

You should also check any withdrawals made from retirement funds during the year.

For example, withdrawals from the savings component under the two-pot retirement system are generally taxable. The amount should appear in your income records and may increase the tax you owe.

Review these figures carefully, especially if the withdrawal was not part of your usual monthly retirement income.

Check your medical expenses

Medical costs often become a larger part of the household budget during retirement. Some qualifying expenses may affect your tax calculation.

Make sure you have your medical scheme tax certificate, as well as proof of qualifying medical expenses you paid yourself.

These may include expenses that were not refunded by your medical scheme. Keep invoices, receipts, statements, and proof of payment in case SARS requests supporting documents.

Many retirees assume that the medical scheme certificate contains everything SARS needs. This is not always the case. Out-of-pocket expenses may need to be added separately if they qualify.

Confirm your SARS profile details

Before filing, log in to your SARS profile and check that your information is up to date.

Review your banking details, mobile number, email address, and residential address.

This is especially important if your contact details changed after retirement or if you still use an email address linked to a former employer.

Incorrect banking details can delay a refund. Outdated contact information may also cause you to miss an important SARS notice or request for documents.

Protect yourself from tax-season scams

Watch out for tax-season scams. Fraudsters often use emails, SMSes, WhatsApp messages, or phone calls that appear to come from SARS. Do not click on links asking you to confirm banking details, passwords, or personal information. Log in to SARS eFiling directly through the official website, and contact SARS or your tax practitioner if anything feels suspicious.

Review an auto-assessment carefully

SARS may issue an auto-assessment using information received from financial institutions, retirement funds, medical schemes, and other third parties.

An auto-assessment can simplify the process, but it should still be checked carefully.

Compare the SARS figures with your own certificates and records. Confirm that all income has been included and that relevant retirement contributions, medical expenses, and other deductions have been captured correctly.

If anything is missing or incorrect, update the return before accepting the assessment.

Keep your supporting records

After filing, keep all supporting documents in a safe and organised place.

This includes pension and annuity certificates, retirement annuity contribution certificates, medical records, investment certificates, and proof of deductible expenses.

A digital folder for each tax year can make record-keeping easier and help you respond quickly if SARS requests verification.

Before submitting your return, check your income, retirement fund transactions, medical claims, personal details, and any auto-assessment.

A careful review can help protect your retirement cash flow, prevent unnecessary delays, and reduce the risk of paying too much tax.

Where your affairs are complex, seek guidance from a qualified tax practitioner or financial adviser.

For more articles by Katlego, click here.