SARS is coming after these taxpayers in South Africa

With the opening of the 2022 tax season drawing near, taxpayers need to be cognisant of their tax compliance and if any outstanding debt is owed to the South African Revenue Service (SARS), says Andre Daniels, legal manager: tax controversy and dispute resolution at Tax Consulting SA.

“As a practice, we are seeing SARS continue to aggressively follow collection steps against taxpayers with outstanding tax debt. This includes withdrawing funds from bank accounts, garnisheeing salaries and threatening personal liability of company representatives,” Daniels said.

“If you are in this position, it is important to know your legal rights as a taxpayer and the steps available to you. A letter of demand is usually the first step in this process.”

SARS’ ‘hitman’

Should a letter of demand/third-party appointment be issued against you, it is important that you do not bury your head in the sand nor become a deer in the headlights, Daniels said.

“Being frozen with fear or indecision will not aid your cause and will only lead to SARS commencing with collection procedures in terms of the Tax Administration Act (TAA), leaving a taxpayer with little to no recourse.

“It is important to remember that a third-party appointment is not a SARS official collecting a debt, but rather SARS legally appointing a third-party in terms of Section 179 of the TAA, such as the taxpayer’s bank or employer, to withhold and immediately pay over to SARS all available funds as per the terms stipulated on the notice of third-party appointment.

“Should a third-party fail to adhere to the appointment, it may result in the third-party being held personally liable to SARS and they may also be convicted of a criminal offence.”

It is of utmost importance for taxpayers who find themselves in the above position to immediately engage the services of an astute tax attorney, who can ensure that the legal process is properly followed, in addressing the alleged tax debt owed to SARS, Daniels said.

Read: SARS is making a key change to the coming tax season – here are the documents you need