SARS is upping the ante against non-compliant taxpayers – here’s what you need to know.
The South African Revenue Service has published a new interpretation note, alerting taxpayers to how it will address and penalise non-compliant taxpayers., seeks to clarify the interpretation of the term “maximum tax rate applicable to the taxpayer,” as mentioned in the Tax Administration Act.
It also provides clarity on how penalties are to be imposed, with in-depth calculations and examples, as a true indication of SARS’ intention to make non-compliance difficult and costly.SARS may impose penalties up to 200% of the capital tax liability“To avoid this, errant taxpayers must, before SARS approaches them, declare previously undeclared income through the ongoing Voluntary Disclosure Programme , which is regulated by the Tax Administration Act,” Daniels said.
For taxpayers that are taxed at a progressive rate of tax, the maximum tax rate applicable to the shortfall is the marginal tax rate applicable to the taxable income or taxable turnover that is established by, ignoring the assessed losses or any other benefit brought forward from a preceding tax period to the tax period in question.
In March, SARS exemplified this crackdown when the authority provided clarity on the tax status of President Cyril Ramaphosa, stating that through staff and advisory, Ramaphosa was fully compliant in the eyes of SARS. “This would go a long way towards building confidence in our country’s institutions,” said Kieswetter.
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