By: Tax Consulting SA
In chasing South Africa’s largest-ever tax revenue collection payday, SARS has truly embraced “spend money to make money.”
Through an additional R7.5 billion expenditure allocation over the Medium-Term, SARS has onboarded 1,700 new resources, from matriculants to seasoned tax experts.
The goal? Spend a few billion to collect R20–R50 billion more per year.
With a debt book exceeding R530 billion, SARS’s assertive collection efforts serve the economy’s best interests, even if taxpayers with civil judgments against them disagree.
SARS’s debt book covers all tax types, including personal and corporate income tax, VAT, and unpaid payroll taxes, and includes those who willfully avoid payments within their means. These taxpayers shouldn’t be surprised when SARS empties their bank accounts.
What If You Can’t Pay SARS? Relief Options Exist
Not everyone in debt to SARS is unwilling to pay. Some individuals and small businesses, due to unforeseen circumstances, simply cannot settle their tax debts. Options include:
Compromise of Tax Debt
For taxpayers facing genuine financial hardship, a compromise allows them to request SARS to write off interest and penalties while settling the capital owed in part or in full, either as a lump sum or through instalments.
The main benefit? A life jacket through interest and penalty write-offs, allowing taxpayers to settle debt and remain compliant moving forward.
Compromises apply across all tax types (income tax, VAT, PAYE) and to all taxpayers, including individuals, trusts, and companies.
Payment Arrangements (Deferral of Payment)
Taxpayers who don’t qualify for a compromise but can’t settle in one payment can apply for a payment arrangement. This allows them to pay off debts through monthly instalments under agreed conditions with SARS, making large debts more manageable.
Be Proactive, Not Reactive
The best strategy to protect yourself from SARS remains ensuring tax compliance. If you find yourself in debt, act swiftly and seek qualified tax advisory services to protect your interests.
Pro Tip: Engage with SARS proactively and seek compromise or payment arrangements before a Letter of Final Demand arrives.
All SARS correspondence should be addressed immediately by a qualified tax specialist or tax attorney to prevent SARS from implementing collection measures.
A Fresh Start is Possible
Through these negotiated solutions, taxpayers can achieve a fresh start, regaining financial stability while ensuring compliance during the 2025 tax filing season. By being proactive, informed, and legally guided, you can navigate Project AmaBillions without unnecessary financial strain.
Tax Consulting SA
