South African taxpayers find themselves in a precarious position where they only find out they owe SARS money once SARS has taken money from their bank account. How do you ensure that this never happens to you or those you care about?

Understanding Tax Law

If you are a South African taxpayer, it is your responsibility to make sure that your taxes are up to date. Even where you use a professional, have gone into SARS to do your taxes or consider yourself capable enough to handle your own tax affairs, there are just so many things which can happen which causes you to owe SARS money. We see most SARS unknown debts arising from SARS assessments which are AI generated or where a taxpayer was inadvertently non-responsive to a SARS message. Once there is a tax debt and you have not followed the correct procedures to protect yourself, the law is clear – pay now and argue later.

Finding out the Truth on your SARS Compliance Status

The status of your tax compliance can be seen on your SARS eFiling profile, however, most taxpayers are only able to determine whether there is a judgement against them when applying for credit or performing a credit check, where the judgement appears as follows –

As a tax firm we do not like surprises, so we use www.taxcheck.co.za to automatically verify this for our clients. Employers use the same system to determine the compliance of their employees with tax, as it provides accurate information and this does not breach taxpayer confidentiality rules.

Consequences of a SARS Tax Judgement

If you do not know already that you can owe money to anyone but the taxman; some life lessons can only be learned from personal experience. One particularly challenging aspect is such a SARS judgement and Certified Statement, which can lead to severe consequences like wage garnishments, asset seizures, and a negative impact on credit ratings.

Understanding SARS Judgements and Certified Statements

SARS judgements and certified statements are potent legal instruments utilized by SARS to enforce the collection of outstanding tax debts. When a taxpayer fails to meet their tax obligations, SARS can obtain a judgement that may result in the issuance of a certified statement, effectively acting as a civil judgement.

Tax Attorneys and the Legal Fix

There is a specific process best handled by a Tax Attorney and who specialises in Tax Debt, once you owe SARS money. The situation is often less doom and gloom than you believe when in experienced hands and you can communicate within the safety of legal privilege. The legal fix you need to achieve is withdrawal of the Certified Statement and where the following is issued by SARS and the Registrar of the applicable Court -

Written by André Daniels, Head of Tax Controversy & Dispute Resolution at Tax Consulting SA