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Sars versus taxpayers

Revenue service responds to Moneyweb reader experiences.
The presentation of a series of tax education webinars is currently being considered, says Sars. Image: Shutterstock

An article about the South African Revenue Service (Sars) published earlier this month prompted many taxpayers to write in about problems they have experienced.

Read: Sars abuses wide powers of debt recovery

Moneyweb asked Sars for comment. It responded, saying that “some of the aspects that we are picking up from your article, as well as the complaints sent through and questions posed in your query” include the following:

1. Taxpayers need to know how to complain and the complaints channel/process available to them

The complaints management office at 0860 121 216 is operational. Taxpayers also use the contact centre number, 0800 00 7277.

Complaints process:

  • Via eFiling. The eFiling complaints form is an online/web-based form as per these quick links –  login to eFiling and lodge a complaint. See our step-by-step guide on how to lodge a complaint via eFiling.
  • Via the Sars complaints management office on 0860 12 12 16
  • During the Covid-19 lockdown, branch visits are by appointment only
  • Once all of Sars’s complaints channels have been exhausted, the Tax Ombud is the next complaints channel.

2. Taxpayers need to know what recourse is available to them when they are unhappy about a transaction or outcome that was communicated to them

Example:

a. Lodge an objection

b. Lodge a suspension of payment

c. While a and b above are in place, come to an agreement with Sars.

3. Taxpayers need to ensure that Sars has their correct contact details and then act (follow-up) immediately on communication from Sars (sent via email and SMS, in addition to eFiling). The email and SMS alerts the taxpayer to what was sent on eFiling.

Sars responded to specific queries sent to it by Moneyweb as follows.

Question 1

Unsophisticated taxpayers have no idea how to deal with additional assessments, or errors made by Sars, or errors they have made on eFiling payments, resulting in penalties and interest. Has Sars considered running webinars explaining these processes?

Sars’s response: Sars is currently considering a series of tax education webinars.

Question 2

Will Sars ever appoint an office to deal with small taxpayers’ problems, or does Sars expect them all to go to tax practitioners or tax lawyers?

Sars’s response: Currently the channels available to taxpayers including individual taxpayers and small business persons is the contact centre and branches where tax agents assist the taxpayer. When it comes to eFiling, Help-You-eFile is the mechanism to connect them to real-time assistance from a Sars tax agent, while on the Mobile Sars application (Sars MobiApp), a call-back function connects them to the Sars contact centre.

Where there is an objection by the taxpayer, the above recourse steps (complaints channel, suspension of payment request) are available for Sars to review the assessment.

Question 3

I recently asked Sars Commissioner Edward Kieswetter at a live session what would happen if an employer had not paid over the pay-as-you-earn (PAYE) tax to Sars. He answered that the employee will never be liable. But of course, the employee is liable, and Sars now takes the money from the employee’s bank account. Is Sars going to continue with this practice?

Sars’s response: In such situations, Sars’s procedure is to obtain evidence in the form of the taxpayer’s/employee’s payslips and bank statements that show the PAYE deduction. Once this is obtained the PAYE credit is granted. Collection is made when the taxpayer (employee) has not provided sufficient proof. In the case where PAYE was withheld by the employer and not paid over to Sars, the employer will be held liable. The employee however has to provide the abovementioned evidence when claiming a PAYE credit. We often find these situations where taxpayers (employees) approach Sars with no IRP5 certificate issued by the employer.

Question 4

Many taxpayers have written to me saying that they have had the exact same experience as SIP Project Managers – that is, Sars raising an additional tax assessment, the taxpayer not knowing about this, the taxpayer not being sent letters of demand, the letters of demand not appearing on the eFiling profile. There is obviously a serious shortcoming within Sars. Does Sars intend to address this in the near future?

Sars’s response: See response to question 6 below.

Question 5

There also appears to be a problem with system-generated letters. Not only are they not emailed to taxpayers, but they do not necessarily appear on the taxpayer’s eFiling profile. It is apparent that Sars’s employees can generate these at a later date, an abuse that is foiled if the taxpayer has taken a screenshot of their eFiling profile.

Sars’s response:

In response to questions 5 and 6, the following principles are applied when issuing correspondence (i.e. letters) to the public:

  • Firstly, check if the entity is a registered eFiler and if so issue the correspondence to their respective eFiling profile.
  • An email and an SMS is sent by eFiling to the taxpayer’s eFiling profile account to notify them of the receipt of the correspondence and informs them to log into the site to review it and act accordingly.
  • Secondly if the taxpayer is not an eFiler, the correspondence is issued to the email address associated to that taxpayer.
  • If neither of the above-mentioned exists, the correspondence is issued through the post channel and physically printed and posted to the taxpayer.

Question 6

Sars has in recent times abused the process of appointing a third party to take money from the taxpayer’s bank account without following due process.

Sars’s response:

  • It is important to note that each case is dealt with on its own merit.
  • Sars has studied the judgment in the matter of SIP Project Manager vs The Commissioner of Sars. Any administrative errors that may have led to the judgment against Sars are being investigated and corrective measures being put in place.
  • The Sars complaints office is able to assist any taxpayer that has a complaint against any administrative actions for Sars to look into.

Question 7

Sars is gaining the reputation of treating a taxpayer as guilty, as someone untrustworthy, and that Sars can do no wrong.

Sars’s response:

Processes and recourse action is in place for taxpayers to query and object to any administrative action or outcome that has been taken by Sars, for the revenue authority to look into.

Sars further noted that there is a need for increased communication between itself and taxpayers at various points of their interactions and tax transactions, and will look into this.

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A family member of mine and her husband worked for a training college which went bust. The payroll manager deducted PAYE but didn’t pay it over to SARS and then disappeared with the money. Yet SARS demanded their PAYE. They drove to Pieter Maritzburg a couple of times to see a (SARS auditor) (edited) and explained it to her. All fell on deaf ears and apparently, SARS can still collect the PAYE from the employee. They had to cash out their savings to pay the PAYE (twice). Her husband died soon thereafter of cancer at age 43 and left her with 4 kids. She had to bake cakes for the home industry to keep going. But the SARS auditor couldn’t give a toss – they just cared about their collection targets!

They don’t give a flying f#&@ who you are or your situation, they want their green stuff.

A skim read through the SARS responses looked like NDZ the constitutional delinquent’s “answers” to Parliament; actually non-answers and just obfuscation. SARS are the arrogant bagmen for the ANC regime’s looting and profligacy; that is all. I use good accountants and tiptoe around them; my last brush was being denied a tax clearance certificate because R0,14 (14 ZA cents) was owed. Try paying SARS that amount! Took two weeks of wheedling and begging. Madness.

I have always found the SARS folk on the other side of the phone friendly and knowledgeable.

If they ask for an assessment or want to audit something- always read up on what the tax law is for that. SARS.gov have some explanations in english rather than legalese.

Perhaps I am stupid but challenging the SARS directly rather than through an accountant etc has not gotten me into trouble , but then my affairs are relatively simple

I agree Gina, if your individual tax affairs are “relatively simple”, you may not need a tax practitioner.

…until such time some unfamiliar, detrimental event occurs out of the blue onto your assessment, then your affairs will become “unsimple” (if there’s such a word).

…one can learn a new skill, time permitting (and if if does not impede on your salaried income generation)….then it’s down to spending time googling “how to” service/repair your own car, fixing your own PC software issues, doing DIY investments 😉 fixing that electrical circuit fault at the house one-self, after obtaining certification yourself; installing my own PV-solar; I can also try to design, manufacture & install my own kitchen cabinets time permitting, and I can also try to repesent myself in the High Court. All can be studied/researched, if one is prepared to spend the time. The time must be added up as an opportunity cost (using your rate/hour salary) how long it takes to accomplish new skill, versus the cost of skilled artisan charging you.

Wow – you lost me with your response Michael

What I don’t like about SARS is that they make you to be the villain and you have to justify deductions claimed and their tax rates for pensioners is unreasonable. Should be interesting to see how they handle medical deductions with the Covid – 19 pandemic – they are not a sympathetic lot

@grahamcr. It’s because I completely LOST THE PLOT there (today only)

On a more serious note, have you read/picked up my (belated) comment on your question re getting money offshore? (on the article “Time to swap equities for bonds”)

@GinaS …apologies, I simply couldn’t resist 😉

Yip, SARS has an answer to everything. The processes allow them to keep on asking for requirements, therefore delaying payments (Tax returned) forever. I’ve been busy for 5 years. SARS can answer all they like, the fact of the matter is that they have the upper hand. You cannot sweeten a ton of sourness with a teaspoon of sugar.

They have the upper hand because that is how the tax law is written. Unlike common law, you are guilty and have to prove your innocence. You can thank Pravin for that.

Remember the sars pandemic?

Because of no relief from a dysfunctional stare it’s going to be SARS vs everyone.

I’ve just read the questions caption i.e. “1. Taxpayers need to know how to complain and the complaints channel/process available to them……” and the other caption.
NOWHERE DID I SEE “COMMUNICATION’
SIP Project Managers complained about communication.
SARS had my employer deduct extra from my salary, while I was actually FULLY PAID UO.
Where is the communication?
Where is the communication?

I suggest that a subject “Logic” (nick named common sense development) be introduced to the school sylabus and that pupils must have a pass mark of 80%!!!

There are far far to many of these unessecary things happening.
These things sap to much energy and costs from people.
Said energy which could be better applied in their workplace.

SARS one day told me I must pay 15% interest. I told them on the back of the form is printed 12%.
Their answer “It’s an old form”.
My question “But I got this form 2 weeks ago from you?”
“Sir it’s an old form”.

Then SARS think the feeling of the people against them is unfair?
Ja well, no fine!

I’ll say it again: communication! (and while communicating let’s add logic).

Mr Kieswetter here’s a suggestion. I know that your personnel can read and write, but please appoint people who are PREPARED AND WILLING to read and write.

I find that many taxpayers don’t have up to date contact details with SARS. When you file a return and change any contact details such as cell phone number and e-mail address you must also make these changes to your e-filing profile.

SARS will always have all the answers. I just don’t believe it anymore. Struggling for 5 years which left me with R100 000 bill from Auditors. It actually cost me money to get some of my money.

Barbara, thanks for this informative report.

Glad to see I’m not the only one with the odd frustration (and it seems SARS Call Centre is not as yet fully staffed(?), as some services are temp not available.)

I can add Question 8:
“If I, as a frustrated taxpayer expended all options, arrive at a SARS branch armed with a loaded RPG-7 rocket-propelled grenade-launcher at the ready, carrying backpack with 3 more rockets, how would SARS respond?”

SARS response:
“We would point out to make use of the SSMO Complaints Office, or the Office of the Tax Ombud as final resort. Failing that, we’ll need to ensure that we hide behind an armor plate of at least 500mm thickness!”

well now … I wonder what the backlog is in taxpayer disputes? Perhaps SARS can publish these stats, to show just how well their “partnership” with taxpayers is working?

Specifically Purchased an RA in 2020 tax year to ensure a Tax refund : Wonder how long that will take !!!

Dying to see if I get my refund this year following ra contributions.

You just have to shake your head and smile sometimes. I do not have a very uncommon profession but the first time I tried to submit my returns via e-filing they clearly did not consider it or make provision for it and trying to get help from the call center proved to be an exercise in pure 140 proof frustration. So I decided the only way out was to give the job to a professional consultant thereby creating and unnecessary but deductible expense.
After that, it came to paying Ceaser. You’d think they would be happy to see me and have a designated person to welcome me, albeit without a cup of tea. Not on your nelly. “How would you like to make payment Sir”. By cheque! “Sir we cannot take cheque payments here you will have to go out the door turn left and up the stairs to the first floor and ask them where you can pay with a cheque.”
Simple enough, except there are no open offices, no Pay Here signs and no enquiries to send you in the right direction. So, knock on the door ask, the friendly lady. “No Sir there is no one here who can help you with that. You can just do an EFT, I’ll give you the reference no to use and just add your Tax no to the end of that”.
The number was as long as my arm and when I added my tax no to it made it look like the patent no for the pilot’s ashtray on a Boeing. Needless to say, my attempt to do this from home proved impossible so off to the bank to see if they could help. First, the help desk tried, the same result, manager also a bit clueless, after fifteen minutes. embarrassingly asks if there is someone who knows how?
Fortunately, I was in a position to pay a little extra to avoid going through this hassle again, but no! Now the Taxman is totally confused and has opened a “case’, to investigate the overpayment followed by more letters! Dear Lord,pray tell, where do these people come from that work at SARS?

Question 8.

How do you feel about losing all the booze and zol tax. Does it make you cry in your pine apple beer?

May I add question 9 please?
Tobacco is prohibited because a zol passed around can pass the virus. However a tin of Coke (how com Coke is not banned under non-essential?) can be passed around between friends.
From next month a bottle of beer can be passed around.
What is the difference?
Anybody?

Oops, there’s three questions there 🙂

My stock response to any suggestion to use SARS’s recommended channels is “have you tried it recently ?”

The best way I can describe my position with SARS is by analogy : it’s as if Home Affairs won’t give me a passport because I don’t have a certificate of incorporation. Doesn’t matter who you talk to.

The way the economy is going the headline should read ‘SARS versus last remaining taxpayers’. Then the ANC SARS will have to do the impossible, get tax payments from their supporters.

The answer is quite simple: open a bank account in Mauritius and obtain a debit card for use in SA. Transfer all your spare cash to this account (you would have made 9,5% per annum on the currency depreciation over the past 10 years). In this way you have minimal cash in your local account that SARS can grab overnight. At least in that way you have cash available to pay lawyers to fight your case.

It really doesn’t matter what SARS says in response to the above statements. The problem very simply is that they automatically start the communication with the assumption that you are essentially a criminal. In every exchange with a SARS employee I have ever had they behave as if their systems are entirely bug-free and every action performed by a SARS employee is above reproach. From there it just becomes a week of hell where I begin putting together documents from years past to try and prove my innocence.

You don’t have to be a genius to see that there is no conceivable way for their systems to be bug-free or for their employees to above approach. E-filing is written using technology that is being actively phased out by companies like Microsoft because they are buggy and open to exploits. Most of the PDF’s SARS generates can’t be used by modern software. All this tech debt they have happily accumulated over the past 10 years will bite them hard in the coming years.

End of comments.

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