Unicus voluntary disclosure program for tax

One of Unicus Tax Specialists SA’s niche tax practice areas is preparing and submitting Voluntary Disclosure Program (VDP) applications to SARS. The VDP is a legislative framework that incentives errant taxpayers to “come clean” on their own volition and disclose their tax defaults by giving “ immunity” from penalties and criminal prosecution for valid applications.

There are two main driving factors for you to need tax specialists like Unicus Tax to assist with Voluntary Disclosure Program (VDP) applications:

• To get the “immunity”, the taxpayer’s disclosure must be full and complete in all material respects (“the full and complete issue”).
• Once the VDP application is successfully processed, you can’t really undo it (“the finality issue”).

Making a disclosure that is full and complete in all material respects requires, in most cases, an expert level of tax knowledge. Assuming tax treatment “a” when it’s actually “b” makes for an incomplete application. Claiming deduction “X” in your application when it is not permissible makes for an incomplete application. Materially incomplete applications are not valid applications, and absent as valid applications, immunity cannot follow.

At the same time, overstating a tax liability is simply unacceptable.

Therefore, the full and complete issue and the finality issue are often two competing or conflicting issues when preparing a VDP application. Identifying this conflict requires an exceptional level of tax knowledge and dealing with this conflict demands pragmatic and realistic thinking.

Some taxpayers tend to feel they should rather overstate than run the risk of a rejection and lose “immunity”. Whilst there are certainly cases where “overpaying” tax is necessitated by circumstance (especially where, for example, there is a lack of evidence), there are others where it is not necessary.

Unicus Tax have always been able to finalise VDP applications to the satisfaction of  clients and have never had a VDP application rejected by SARS.

The experts available work on applications where the disclosure stretches across several periods and spans several tax competency areas.

Also read: Understanding how tax and property investment work