By: Natasha Archary
A recent survey by GoBankingRates found that the top tax concern among young people between the ages of 18 – 24 is making a mistake with their tax submissions.
Almost 27% of youth, or Gen Z as they are commonly referred, are fairly inexperienced with the world of taxes and finances in general.
Plus, making mistakes on your tax return could not only mean missing out on certain write-offs, but potentially, facing penalties.
Tax expert Godfrey Modipa joins Gugulethu Mfuphi on Kaya Biz to go over some of the common tax mistakes young people often make.
“If you’re registered for tax, there’s a lot of benefits for it. For those who are self-employed, entering the marketplace, companies insist that before they employ you, you ensure you have a tax number, so when they deduct tax from your salary it can go to SARS.
The benefits of you complying with your taxes is your expenses, the expenses your company incurs. This is how you can show them when you’re doing your submissions in your financial year end.”
Tax expert Godfrey Modipa
Godfrey says one of the most common tax mistakes that the youth of today makes deals with medical expenses. Most youth without a medical aid, pay cash for their doctors fees and prescription medication, but never keep the receipts.
“One of the most asked question when a tax return comes back to you, ‘How do I owe SARS, if they’re deducting the money from me every month?’
Some people don’t have medical aid, they pay cash, so keep the receipts. Try to distinguish them as well, if you go buy your medicines together with groceries, it’s harder to prove. So, you can challenge if it comes back that you owe SARS.”
Common tax mistakes young people make
- Not knowing whether you’re a dependent
- Not paying taxes on unemployment
- Failing to write-off business expenses
- Under-reporting your income
- Ignoring messages from SARS
- Forgetting to file
- Spending too much
- Missing deductions, credit and refunds
Listen to the conversation on Kaya Biz:
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