MORE RISKS TO TAXPAYERS!

Posted by Bennie Groenewald on 31 March 2021.



Bennie Groenewald

LLM Tax Law, B.Proc, HDip Tax

The Tax Shop Head Office

More about Bennie Groenewald

After having qualified and practiced as a Commercial lawyer Bennie worked in the Banking and Financial services industry for 25 years across multiple market segments in South Africa, Sub-Saharan Africa and the UK, the last 14 years of which in senior and executive leadership positions. During this time, he dealt extensively with cross-border banking and finance including project finance, asset finance, debt capital markets and derivatives, including the legal aspects thereof. In recent years, Bennie has played an active leading role in investment, credit and risk management as well as sound corporate governance.
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In the 2021/2022 Budget Speech delivered on 24 February 2021, the Minister of Finance stated: “We owe a lot of people a lot of money. We must shore up our fiscal position in order to pay back the massive obligations we have incurred over the years.”

The days of taxpayers’ tax compliance status not being fully tested by SARS are well and truly over – SARS is closing loopholes and there may be a few surprising tax-potholes, lurking ahead.

South African Revenue Service, Strategic Plan for 2020/21 – 2024/25 spells it out clearly:

  • Detect taxpayers and traders who do not comply, make non-compliance hard and costly and focus on short/medium term revenue recovery projects.
  • Where necessary, hard enforcement may include court action, asset seizure and criminal prosecution.
  • Non-compliant taxpayers and traders may under certain circumstances be named and shamed.

The costs for non-compliance, it is clear, will be high and severe.

According to SARS Commissioner, Edward Kieswetter, improved tax collection and administration continues to be an important element in achieving targets as SARS continues to rebuild its capacity to close the gap between how much tax should be collected and how much is collected.

Some game changing examples are:

  • SARS now receives information on SA taxpayers from 87 jurisdictions in terms of the automatic exchange.
  • A specialised department is to be established that will focus only on high net-worth individuals.
  • Upgrading its team in specialised audit and investigative skills in order to combat avoidance, evasion and tax crime.
  • SARS has also launched a significant campaign to recruit large numbers of specialists to assist with legal, governance, risk compliance, IT and a host of various fields.

It is becoming increasingly important that taxpayers ensure their affairs are in order.  For the most professional guidance, I advise that you contact a Tax Shop near you today.