Sars Auto Assessments Offer Convenience But May Miss Deductions Warns Tax Director

While the system has streamlined tax compliance by using information supplied by employers, banks, medical schemes and other third parties, experts warn that omissions, reporting errors or missing deductions could leave taxpayers paying more tax than necessary or forfeiting legitimate refunds.

Sars is set to issue auto-assessments between Wednesday, 1 July 2026 and Sunday, 12 July 2026, with taxpayers notified via SMS, email, eFiling or the Sars MobiApp.

While the system has significantly simplified the filing process for millions of taxpayers, Danielle Luwes, tax director at Hobbs Sinclair, cautions that the convenience of an auto-assessment should not be mistaken for certainty.

"An auto-assessment is only as accurate as the information available to Sars at the time it is generated," says Luwes. "Sars has made enormous strides in digitising the tax system, but it cannot independently verify every aspect of an individual's financial affairs. Taxpayers should treat an auto-assessment as a starting point for review, not as confirmation that everything is correct."

According to Sars, auto-assessments are based on data received from third-party institutions and are intended primarily for taxpayers with relatively straightforward tax profiles. However, taxpayers remain responsible for ensuring that all income, deductions and tax credits have been accurately recorded.

Luwes says that one of the most common misconceptions is that once Sars has issued an assessment, all relevant information must have been included.

"In reality, there are numerous situations where information may be incomplete, delayed or incorrectly reported. Sars cannot necessarily determine whether you have incurred additional deductible expenses, whether your travel claim has been correctly calculated, or whether all your retirement-annuity contributions have been captured," explains Luwes.

She warns taxpayers to pay particular attention to:

• Retirement-annuity contributions that have not been fully recorded
• Medical expenses that may qualify for additional tax credits
• Travel allowances and business-related travel claims
• Rental income and related deductible expenses
• Interest and investment income that may have been incorrectly reported
• Changes in tax-residency status
• Additional income earned from freelance, consulting or side-business activities
• Employer payroll errors appearing on IRP5 certificates

In one example, a taxpayer contributing to multiple retirement products during the tax year may find that not all contributions have been fully reflected in the pre-populated return. In another, a taxpayer with significant out-of-pocket medical expenses may qualify for additional relief that does not automatically appear in the assessment.

"We regularly encounter cases where taxpayers are due refunds they were unaware of, simply because they assumed Sars had already taken everything into account," says Luwes. "Conversely, we've also seen assessments where income was duplicated or reported incorrectly, creating a larger tax liability than was actually due."

The stakes can be significant. Depending on a taxpayer's circumstances, correcting omissions or claiming legitimate deductions can result in savings ranging from a few thousand rand to substantially more in complex cases.

Luwes again cautions taxpayers against treating the auto-assessment notification as an administrative formality. "Many people see the message from Sars, notice that no action appears to be required and simply move on. That approach can be costly. The assessment may be correct, but it may not be. The only way to know is to review it properly."

Importantly, taxpayers who disagree with an auto-assessment do not have to accept it. They may submit a tax return containing the correct or additional information during the normal filing season. Sars specifically provides for taxpayers to amend or supplement information where the auto-assessment does not reflect their complete tax position.

For taxpayers with multiple income streams, investment portfolios, rental properties, foreign income, trusts or other complex financial arrangements, seeking professional advice may be hugely beneficial.

"The cost of a professional review is often far lower than the cost of an error," says Luwes. "A tax practitioner may identify deductions, credits or compliance issues that would otherwise go unnoticed. In many cases, a short review can provide reassurance that the assessment is correct or highlight opportunities to legitimately reduce a tax liability."

As Sars continues expanding its auto-assessment programme and increasing the amount of third-party data used in assessments, Luwes believes taxpayers should embrace the convenience while remaining vigilant.

"Auto-assessments are an excellent development and have made compliance much easier for millions of South Africans. But taxpayers should remember that Sars sees a great deal of information — not necessarily all of it. Ultimately, responsibility for the accuracy of a tax return still rests with the taxpayer."