Detailed analysis of SARS’ debt collector threats

Your company has never traded, and you didn’t submit any tax returns. SARS imposed a penalty of R250 each month for every outstanding return. Here’s the letter that you received: -

Dear Taxpayer,

Kindly note your account INCOME_TAX reference no 9903828151 is in arrears of R35 500,00. Kindly settle the full amounts immediately. Please log on e-Filing to initiate a payment arrangement. Revenue Consulting on behalf of SARS. Contact us on 010 510 6932 or email your proof of payment to [email protected]

For payment kindly utilize the below mentioned

SARS is a bank approved beneficiary, on your banking App kindly select:

• Public Beneficiary
• Search for SARS,
• Select SARS ITA
• Payment Reference Number 9903828151AI0000010
• Initiate your payment.

Failure to do so here are some of the consequences that SARS will initiate:

It is a criminal offense not to submit a tax return when it is due and can be a criminal offense not to pay.

If you do not pay your taxes, there are several debt collections options at our disposal:

• Collect the debt from someone who holds money on your behalf Third Party appointments i.e. employer, bank, or customer.
• Issue a judgement and have your name
• Attach and sell your
• Obtain a preservation order in respect of your
• If you hold assets offshore, an order can be obtained compelling the assets to be repatriated to South Africa and in the interim your right to trade or to travel can be restrained.
• Liquidate or Sequestrate your Estate.

Your prompt response with the proof of payment will be appreciated. Our office hours are ?from 08h00 -16h30 ( Mon-Fri)

Charlotte Mokwane

Collection Consultant

Here’s what the Tax Administration Act says:

1. Representative taxpayer.

(1)??????? In this Act, a representative taxpayer means a person who is responsible for paying the tax liability of another person as an agent, other than as a withholding agent, and includes a person who—

(a)?????? is a representative taxpayer in terms of the Income Tax Act;

So, it is your job to ensure that the company pays its tax liabilities.

1. Personal liability of representative taxpayer.

A representative taxpayer is personally liable for tax payable in the representative taxpayer’s representative capacity, if, while it remains unpaid—

(a)?????? the representative taxpayer alienates, charges or disposes of amounts in respect of which the tax is chargeable; or

(b)?????? the representative taxpayer disposes of or parts with funds or moneys, which are in the representative taxpayer’s possession or come to the representative taxpayer after the tax is payable, if the tax could legally have been paid from or out of the funds or moneys.

If you diverted the company’s money when it could have been used to pay its tax liabilities, you can be held personally liable for those taxes. But it never had any money to divert.

1. Public officers of companies.

(1)????? Every company carrying on business or having an office in the Republic must at all times be represented by an individual residing in the Republic.

(5)???? A public officer is responsible for all acts, matters, or things that the public officer’s company must do under a tax Act, and in case of default, the public officer is subject to penalties for the company’s defaults.

You are responsible for the submission of the company’s tax returns.

1. Criminal offences relating to non-compliance with tax Acts.

(2)????? Any person who wilfully or negligently fails to—

(d)???????? submit a return or document to SARS or issue a document to a person as required under a tax Act.

If this bothers you, why not submit the Nil returns now? It is not a criminal offence to submit late returns.