Warning over SARS deadline change

The South African Revenue Service (SARS) has extended the filing season deadline for non-provisional individual taxpayers to 2 December, from 23 November initially.

While this will give taxpayers some breathing room, South Africans should be careful of further severe punishments for non-compliance, said Jean du Toit, head of tax technical at Tax Consulting SA.

In a statement on Tuesday (23 November), SARS said it is ‘acutely aware’ of systemic issues the organisation has experienced and the impact of load-shedding on taxpayers, which made it difficult to file returns. Because of this, the revenue collector said it will extend the deadline.

Taxpayers should see the concession as a final shot across the bow to those who plan to file late or not at all, said du Toit.

“It is important to note that this filing season may come with more serious sanctions when compared to prior years. Some may need reminding that National Treasury and SARS successfully pushed through an amendment with effect from 1 March 2021, which essentially holds taxpayers to a higher standard of compliance,” he said.

“Prior to this date, taxpayers would only be subject to criminal sanctions under the Tax Administration Act if they knowingly and willfully flouted their tax obligations. In other words, if a taxpayer out of ignorance failed to submit their return, they may suffer monetary penalties, but they would not be guilty of a criminal offence.”

Du Toit said ignorance is no longer a defence, and you can now be held criminally liable for failing to submit your return, even if you act without intent.

“SARS may just have given this extension to eliminate any excuses. One of SARS’ primary strategic objectives is to promote compliance, and there is no better way than making examples of delinquent taxpayers under the new legislation,” he said.

“While taxpayers will welcome this development, those who doubt SARS’ commitment to enforcement should perhaps consider the real reason behind SARS’ indulgence.”

Tougher stance 

In a letter sent to stakeholders earlier in November, SARS warned that it plans to get stricter on taxpayers as part of a larger organisational shift.

This, it said, is part of a strategic objective to make non-compliance difficult and costly, adding that it is ‘imperative’ that it enhances its ability to impose administrative penalties in a more responsive manner.

“With effect from 1 December 2021, SARS has been empowered to levy a late submission of return penalty where one or more personal income tax returns are outstanding. As a transitional measure for the first year, the one tax return or more rule will only apply to the 2021 tax return,” it said.

Prior to 1 December 2021, SARS could only levy a late submission of return penalty on two or more outstanding tax returns. This older rule will remain in place for an additional year, for returns from 2020 and earlier.

Read: SARS extends tax deadline due to load shedding and other issues