Use the following 6 record-keeping tips to avoid paying penalties...
You can only claim deductions if you have valid proof of your deductions.
ALL invoices issued to you can reduce your tax, so if you lose any of them you'll end up paying more tax than you legally have to.
Make sure you claim ALL deductions you're entitled to.
Without invoices, you'll easily overlook certain expenses which you've incurred.
Keep a record of EVERY expense, EVEN if you're not sure it's tax deductible.
Determine the amounts you pay towards salaries or wages.
Keep proof such as wage registers, proof of payment, proof of employment, copies of identity documents of casual employees,
acknowledgements of the receipt of payments and amounts.
If you keep all of this, you can claim all amounts paid for salaries and wages, ESPECIALLY casual wages and wages paid in cash.
Make sure you can fully explain the amounts you declare in your tax returns.
SARS will question the accuracy of your declarations if you're unable to support them with evidence. And if you can't prove any deductions you've claimed, then SARS will question the validity of ALL your claims!
Ensure you're in a position to prove your declarations, as this will improve your relationship with SARS, leading to trust and a reduction in unnecessary queries from their side, saving time performing audits.
If you keep accurate records, your business will be able run smoothly.