Industry updates | November 2023
Please take note of the following industry updates that may be relevant to you and your business.
COMPLIANCE AND ADMINISTRATION
Due dates for reporting and payments- November 2023:
TAX ADMINISTRATION
1. SARS coming down hard on non-compliant entities:
On 24 October 2023, thousands of company tax representatives were shocked when SARS issued the following warning notice:
“Dear Tax Representative of (Taxpayer Name) you failed to submit your company income tax returns with reference no: XXXXXXXXX. Failure to submit the returns is a criminal offence in terms of section 234, (2)(d) of TAA. to avoid more administration penalties being levied against you, kindly submit all the outstanding returns within 10 days of this SMS, should you fail to submit the returns, we will initiate the criminal process and send you a NOTICE OF INTENTION TO SUMMONS. Please ignore if you have since complied. SARS”
Many tax representatives have set with the impression that where a company is dormant, no returns must be submitted to SARS. However, this is not the case. All companies are required to submit their annual tax returns, within 12 months of the end of the year of assessment. SARS also reserves the right to levy penalties of between R250 to R16 000 per month for any outstanding return.
2. Basic Guide to Section 18A Approval:
Government has recognised that certain organisations are dependent on the generosity of the public and to encourage that generosity has provided a tax deduction for certain donations made by taxpayers.
The eligibility to issue section 18A receipts is restricted to specific organisations approved by the Commissioner that use the donations to carry on or fund specific PBAs in South Africa.
These specific organisations must apply to the Commissioner for approval under section 18A to issue section 18A receipts for donations received.
A section 18A receipt may be issued by a section 18A-approved organisation only from the date the Commissioner has confirmed section 18A approval. The Commissioner issues a reference number for purposes of section 18A which must appear on the section 18A receipts.
3. SARS’ PAYE modernisation drive sees the introduction of monthly employer recons:
On Friday, 6 October 2023, SARS published the external Business Requirements Specification (BRS) document for the PAYE monthly reconciliation submission, effective from 1 March 2025.
As SARS continues to forge ahead with its modernisation journey, the introduction of the PAYE monthly reconciliation submissions is likely to replace the current employees’ tax, provisional tax and assessment filing seasons for employers and non-business individuals, with a modern and fully automated tax assessment, withholding and payment tax system. The published PAYE Monthly Submission External BRS defines the requirements employers must adhere to for the monthly submissions.
4. Online registration now open for the Excise diesel refund for Foodstuff Manufacturers:
On Friday, 22 September 2023, SARS announced that the submission due date for electronic registration to the Diesel Refund for Food Manufacturers Scheme would be extended from 26 to 29 September 2023. This extension was because of the additional testing and quality assurance measures implemented by SARS to ensure that the new refund scheme is streamlined.
Subsequently, on 30 September 2023, SARS announced the official opening of the online registration for the Diesel Refunds for Foodstuff Manufacturing Scheme (DRFMS).
To register for the DRFMS, the DA 185 form will need to be completed before registering online, as it needs to be attached to the online registration. The application to register as a refund user is therefore done on the DA 185 form accompanied by Annexure DA185.4A3 form. The form and supporting documents must then be submitted via the new SARS Online Query System (SOQS).
For assistance in completing the DA 185, DA185.4A3 or DA 66 forms, members can access the short tutorial videos on the SARS YouTube channel:
• How to complete the DA185 Form and Annexure
• How to complete the DA66 Form
5. Tax compliance Status
We are aware that the letter we issued to apply for Tax Compliance Status (TCS) has caused some confusion.
The letter is titled ‘PIN Issued’. This means that SARS has issued a PIN, but this message has been mistaken for an indication that the taxpayer is tax compliant. This is not true.
Instead, the letter indicates:
TCS details (name and reference number of the taxpayer to whom the PIN applies)
PIN number
Expiry data
The letter advised the requestor of the TCS as follows: ‘You may authorise a third party to view your TCS by providing with them the PIN. The PIN only allows the third-party access to your TCS. All other tax information remains secure’.
The third party who receives the PIN will log into their own profile on SARS eFiling and verify your TCS using the PIN provided. The view they will see will indicate:
- Domonique Ramos | 1 November 2023