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Voluntary disclosure for tax payers

17 Sep 2010

According to an announcement by the Minister of Finance, the South African Revenue Services (SARS) will be launching a voluntary disclosure programme which will offer amnesty to qualifying tax payers. Although full details are not yet available, these tax payers will receive amnesty against additional taxes, penalties and interest arising from previous defaults.

A defaulting tax payer will be granted relief under the programme, provided:

  • SARS was not previously aware of the default,
  • a penalty or additional tax would have been levied had SARS discovered the default,
  • full disclosure is made.

Tax payers may apply for relief on condition that that they are unaware of pending or current investigations into their tax affairs and that the disclosed default occurred at least 12 months prior to the commencement of the programme.

A valid disclosure will result in the following relief:

  • amnesty from any criminal prosecution,
  • waiver of all penalties and additional taxes, excluding any administrative penalties,
  • 100% relief from interest in the case of a tax payer not being aware of any pending audit or investigation,
  • 50% relief from interest in the case of those tax payers who receive permission from the Commissioner to apply for relief despite pending or current audits into their affairs.

Reserve Bank
In addition, the exchange control department of the South African Reserve Bank has announced its intention to launch a similar programme to coincide with that of SARS. The Bank’s programme includes:

  • disclosures that will not attract any levy: these include contraventions of specific regulations by a natural person and corporate entities;
  • disclosures that will attract a 10% levy: this applies to persons (corporate and natural) who have entered into loop structures or are donors of a foreign discretionary trust in contravention of regulations;
  • general administrative relief.

Applications, which have to be made via an authorised dealer, must be submitted before 31 October 2011.

Belastingbetalers wat onseker is of hulle van die vrywillige openbaarmakingsprogramme gebruik moet maak, kan die volgende faktore in ag neem:

  • Oortredings wat gedurende die huidige finansiële jaar begaan is, kwalifiseer nie vir amnestie nie.
  • Die openbaarmakingsprogram is van toepassing op alle belastingbetalers en alle tipe belasting.
  • Die program maak dit vir belastingbetalers moontlik om anoniem navraag te doen of hulle daarvoor kwalifiseer.
  • Belastingpraktisyns is nie outomaties gevrywaar van die verpligting om hul kliënte se belastingsake aan die SAID te openbaar nie. Tans word samesprekings egter met die Finansiële Intelligensiesentrum gevoer oor die moontlikheid dat belastingpraktisyns van hierdie verpligting vrygestel word.

Regardless of the motive behind the disclosure programmes, qualifying tax payers or residents should take the opportunity to disclose any default and avoid the very real risk of prosecution and heavy penalties.

For more information contact Tenk Loubser on tel. 021 808 7220 or e-mail tenk@exceed.co.za.

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