How the SARS auto-assessment actually works
From the 2022 filing season SARS has issued auto-assessments to millions of individual taxpayers whose tax affairs look straightforward. SARS pre-populates an ITR12 from third-party data — your IRP5 from the employer, IT3(a) from retirement funds, IT3(b) from banks and investment houses, IT3(c) for capital gains, your medical scheme tax certificate, and donation Section 18A certificates — and pushes the assessment to your eFiling inbox between early July and mid-July. If you do nothing within 40 business days, the assessment becomes final.
The three decisions you can make
Once you open the auto-assessment on eFiling, you have three buttons that matter and a clear rule for picking between them.
1. Accept
Use only when every income source SARS sees is correct AND you have no deductions to add. The classic safe case: salaried employee, single employer, medical aid handled via payroll, retirement annuity via payroll, no rental income, no freelance income, no logbook. If that is you, accept and move on — a refund (or nil) will be processed within 72 hours.
2. Edit
Use when the income is right but you have deductions SARS does not know about. Common edits: out-of-pocket medical expenses above what your scheme paid, retirement annuity contributions made directly to a provider (not via payroll), home-office expenses, donation Section 18A receipts. Open the return in edit mode, add the missing lines, and submit. SARS reissues an ITA34 within a few days.
3. File a fresh ITR12
Use when income is also wrong or incomplete — typically because you have rental income, freelance/sole-proprietor income, foreign income, capital gains the broker did not report, or a travel allowance requiring a logbook. The auto-assessment is not designed for these cases. File a full ITR12 from scratch and treat the auto-assessment as a draft.
Deductions and income types the auto-assessment almost always misses
- Out-of-pocket medical expenses — anything paid in cash or by card to a doctor/dentist/pharmacy not routed through your medical scheme. Above the 7.5%-of-taxable-income threshold, 25% of qualifying expenditure becomes an additional medical credit.
- Direct retirement annuity contributions — RAs contributed outside payroll. Get the IT3(s) tax certificate from the provider.
- Home office — only if you have a dedicated workspace used regularly and exclusively for work, and your employer requires you to work from home more than half the year. Apportion rent/bond interest, electricity, cleaning, and security by floor area.
- Travel allowance / company car logbook — without a SARS-format logbook your travel deduction is calculated on the deemed-cost tables, which are usually less favourable.
- Rental income — gross rentals less rates, levies, bond interest, repairs, agent commission. Net loss is generally ring-fenced under section 20A but the income must still be declared.
- Freelance / sole-proprietor income — declared under "local business, trade and professional income". You should also be registered as a provisional taxpayer.
- Foreign income — including foreign dividends, foreign interest, foreign employment income (subject to the section 10(1)(o)(ii) R1.25m exemption rules), and section 6quat foreign tax credits.
- Capital gains on private share trades, crypto disposals, or the sale of a second property — third parties often do not report these.
- Donation Section 18A certificates — deductible up to 10% of taxable income for donations to qualifying Public Benefit Organisations.
What happens after you accept (or do nothing)
Accepted (or auto-accepted) assessments become legally final after the 40 business-day objection window closes. To dispute later you must file a Request for Reduced Assessment (RRA01) under section 93 of the Tax Administration Act — possible, but it requires you to show SARS made a "readily apparent undisputed error". Realising you forgot R30,000 of home-office deductions usually does not qualify. The lesson: edit before accepting, not after.
What happens if you under-declare
If SARS later receives third-party data showing income you did not declare (a common scenario with rental income or crypto trades), they will issue an additional assessment with interest from the original due date plus an understatement penalty of 0%–200% depending on behaviour. Voluntary disclosure under the VDP programme avoids most of the penalty if you come forward before SARS contacts you.
The safest filing-season routine
- Open eFiling in early July. Note the deadline on your assessment letter.
- Pull your IRP5, IT3 certificates, medical scheme certificate, RA certificates, donation Section 18A receipts, and any rental/freelance records.
- Run the checker above. If it flags anything, edit before accepting. If everything is green, you can accept.
- Keep the assessment notice (ITA34) and supporting documents for five years.
Authoritative sources
See SARS at sars.gov.za → Individuals → Tax Season → Auto-Assessment. For complex situations (foreign income, large CGT events, business losses) consult a registered SAIT, SAICA, or SAIPA tax practitioner before accepting or filing.