Deadline for submission of IT3(D) returns fast approaching

In line with South African Revenue Services’ (SARS) strategic objective to make it easy for taxpayers to meet their personal tax obligation, SARS has introduced a new filing requirement for all Section 18A approved organisations.

Government Gazette 48867 issued on 30 June 2023 states that all persons referred to in section 18A(1)(a) to (c) of the Income Tax Act, that issued a receipt in terms of section 18A(2) of the Act are required to submit third party data to SARS.

The third-party data submission is an IT3(d) return and applicable to all Public Benefit Organisations (PBOs) who are authorized to issue s18A receipts. The due date for the returns covering the period 1 March 2023 to 29 February 2024 is 31 May 2024, and is fast approaching.

All section 18A approved organisations are urged to meet the deadline for the IT3(d) returns. Failure to submit these returns could result in non-compliance and SARS revoking the organisation's section 18A exempt status.

The information to be disclosed in the IT3(d) returns is consistent with the requirements for a valid section 18A receipt, which are as follows:

Name, address and PBO reference number of PBO who received the donation
Date of the receipt of the donation
Name, address, contact number and email address of the donor
Amount of the donation or the nature of the donation (if not made in cash)
Donor nature of person (natural person, company, trust, etc.);
Donor identification type and country of issue (in case of a natural person);
Identification or registration number of the donor;
Income tax reference number of the donor (if available);
A unique receipt number; and
Trading name of the donor (if different from the registered name).

If a PBO has issued s18A receipts to donors, then this information should be available to complete the IT3(d) returns.

Even if the PBO has not issued any s18A receipts for the period 1 March 2023 to 29 February 2024, the organisation is still required to submit a nil declaration to SARS.

It is important to note that before these returns can be done the IT3 tax type must be activated on eFiling. Therefore, it is important for all PBOs to ensure that their Registered Representative and RAV01 forms are up to date in order to activate the IT3 tax type.

SARS has made 3 platforms available for taxpayers to submit the IT3(d) returns:

The first platform is through eFiling and is limited to 50 entries. The taxpayer submits an IT3-01 form that contains all the relevant information mentioned above for each s18A receipt. Thereafter, an IT3-02 must be submitted which is a declaration confirming that the information in the IT3-01 is correct. The SARS Guide for the Submission and Declaration of IT3 Party Data via eFiling provides more guidance on this.

The second platform is to the Secured File Gateway (HTTPS) which is limits files to 10mb or 50 000 entries. This is a 5-step process and involves requesting a certificate from SARS via eFiling which takes you to the secured gateway where the data file can be submitted via the HTTPS platform. SARS provides guidance on using the HTTPS Channel in the Guide for the Submission of Third Party Data using the HTTPS Channel.

Lastly, the Connect Direct channel allows unlimited entries. It also follows a similar 5-step process as the Secured File Gateway and guidance on using this platform is given in the Guide for the Submission of Third-Party Data using the Connect Direct channel.

Kindly note the data files to be submitted for the Secure File Gateway and the Connect Direct Method must be prepared according to the SARS Business Requirements Specification.

As this is the first year where s18A approved organisations are required to submit IT3(d) returns, there is still much uncertainty around these submissions.

Should you require assistance, please feel free to contact our Tax team.

Thyler Webb

Tax Compliance Officer, Cape Town

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