#YourTaxMatters: What happens if I didn’t submit my Tax Return on time?

What happens if I didn’t submit my Tax Return on time?

• For individuals, a penalty will be imposed where the taxpayer has failed to submit a return as and when required under the Income Tax Act for years of assessment commencing on or after 1 March 2006 where that person has two or more outstanding income tax returns for such years of assessment; and
• For companies, a penalty will be imposed where the company has failed to submit an income tax return as and when required under the Income Tax Act for years of assessment ending during 2009 and subsequent calendar years, where SARS has issued that company with a final demand referring to the public notice and requiring the submission of the outstanding income tax return, and the company failed to submit the return within 21 business days of the date of issue of the final demand.

Taxpayers who do not submit their tax returns will be charged an admin penalty which must be paid over to SARS. The administrative non-compliance penalty for the failure to submit a return comprises fixed amount penalties based on a taxpayer’s taxable income and can range from R250 up to R16 000 a month for each month that the non-compliance continues.

Administrative penalties recur each month that the taxpayer is non-compliant, up to a maximum of 35 months. Each recurring penalty will have a unique transaction number.

How do I contact SARS with my debt query?

Taxpayers can now request account-related queries (balance statements) and/or a Statement of Account by sending an SMS to SARS on 47277. Send the following wording to 47277: Balance (Space) ID number/Passport number/ Asylum Seeker number

What happens if I owe SARS?

The following options are available to service your debt:

• Pay full balance outstanding within the stipulated due date
• Request to pay in instalments in terms of of section 167 of the Tax Administration Act (TAA), giving reasons and proof
• Request with reasons and proof to compromise the debt (ie. ask to pay a lower amount than what you owe) in terms of s200/201/202 of the TAA
• Where debt is disputed/there’s an intention to dispute, apply for the suspension of debt in terms of s164 of the TAA

SARS provides for a deferment, or instalment payment arrangement, for outstanding tax debt. You may request and enter into an instalment payment arrangement with SARS. It allows you to pay your outstanding debt in one sum or in instalments over time until you have paid your entire debt, including applicable interest.

This agreement, however, would be subject to certain qualifying criteria. All of these requests may be done via eFiling or at a SARS branch (remember to make an appointment first before visiting a branch)

It is a criminal offence not to submit a tax return when it is due and can be a criminal offence not to pay.

If you don’t pay your taxes, there are a number of debt collection options at SARS’s disposal:

• Collect the debt from someone who holds money on your behalf through Third Party appointments i.e. employer, bank or customer.
• Issue a judgement and have your name blacklisted.
• Attach and sell your assets.
• Obtain a preservation order in respect of your assets.
• If you hold assets offshore, an order can be obtained compelling the assets to be repatriated to South Africa and in the interim, your right to trade or to travel can be restrained.
• Liquidate or Sequestrate your Estate.

If you are having difficulties, we encourage you to contact SARS Contact Centre at 0800 00 7277 to avoid these collection steps.