Pedri Reyneke | CEO | Multilink Financial Services | mail me |
Retirement annuity contributions can carry forward when taxpayers do not claim them. However, most taxpayers never check whether this happened.
Taxpayers who received a South African Revenue Service (SARS) auto-assessment this month can submit a corrected return if they find something inaccurate or missing.
One of the most commonly overlooked corrections involves a contribution that a taxpayer made months or sometimes years before this year’s assessment was generated. Consequently, these contributions rank among the most common SARS auto-assessment risks taxpayers face.
Auto-assessment blind spot – why taxpayers should verify
SARS has already auto-assessed more than 1.9 million taxpayers this filing season. It has also paid roughly R8 billion in refunds within 72 hours. Overall, SARS expects to issue more than six million assessments.
This speed reflects this year’s system enhancements. It also reflects complete employer, medical scheme and retirement fund data that matched correctly to each taxpayer. However, retirement annuity contributions often disrupt that match. This usually happens when a taxpayer makes a contribution through a provider or during a tax year that does not align neatly with the current assessment period. As a result, taxpayers should remain aware of SARS auto-assessment risks.
SARS is processing refunds faster than ever. Therefore, taxpayers may assume the system has already captured and verified everything correctly on their behalf. However, the system can only interpret the data it receives. It cannot account for anything beyond that.
How the deduction works
Section 11F of the Income Tax Act allows taxpayers to deduct retirement annuity contributions of up to 27.5% of their remuneration or taxable income.
Effective 1 March 2026, for the 2026/2027 tax year, the maximum annual monetary limit for retirement fund deductions increased from R350,000 to R430,000. Contributions above that limit carry forward automatically to the following tax year. They should also appear on the taxpayer’s notice of assessment, the ITA34.
The challenge is that the current assessment must correctly link to a historic contribution. When that link breaks, the deduction disappears with it. In most cases, nothing on the assessment clearly signals that something is missing.
Most people treat their retirement annuity as something they set up once and never review again. In addition, the notice of assessment does not automatically detect a missing figure. The taxpayer, interpreting the document or an advisor the client trusts to identify such errors, remains the only person checking for discrepancies.
What to check before accepting
I recommend that anyone who has changed jobs, switched retirement annuity providers, or made contributions outside a standard payroll deduction review their assessment carefully. They should also confirm whether the assessment includes last year’s excess contribution.
If the contribution is missing or if the figure looks unfamiliar, they should raise the issue before accepting the assessment. They should also act before the acceptance period lapses. Taking this step can help taxpayers avoid costly SARS auto-assessment risks.
You can still submit a corrected return through eFiling until 23 October 2026, even after accepting an assessment. Likewise, you should check your own numbers with the same discipline you apply to any document that contains your name and your money.
Other common gaps in auto-assessments include home office expenses, actual travel claims supported by a logbook and rental or freelance income. SARS’s third-party data does not capture these items. Therefore, my advice for this filing season is simple: treat July as an annual check-in on your tax affairs.
Every year, I consult with multiple clients who have old contributions that never made their way back into their assessments. They were unaware of these missing contributions. The earlier someone identifies the issue, the less time and money it costs to fix. Therefore, read your assessment before you accept it. Do this without exception to verify that it accounts for everything.
