This tax season, make sure you follow the rules to get paid on time, and if Sars breaks the rules, contact the tax ombud, writes Maya Fisher-French
An investigation into the delay of payment of tax refunds has been undertaken by the Office of the Tax Ombud; however, while in some situations the SA Revenue Service (Sars) has caused a delay, CEO in the Office of the Tax Ombud, Advocate Eric Mkhawane, says there are also many cases where the taxpayer delays the process. Mkhawane says, based on the many complaints received, there are common errors made by taxpayers:
HAVE YOUR DOCUMENTS READY
In many cases when a refund is claimed, Sars asks for supporting documents. The sooner you submit those documents, the sooner your refund will be approved, or declined. “Taxpayers cannot come to us and complain that they need more time to compile the documents. They needed to use the information in those documents to complete the tax return, so they should be readily available,” says Mkhawane.
ONLY MAKE LEGITIMATE CLAIMS
Mkhawane says some people try to take advantage of the tax system by making invalid claims. This requires more work for Sars, which must now focus on tax evasion. This also causes delays in the finalisation of the process of assessment.
BEWARE OF FALSE PROMISES
Mkhawane says there are cases of certain tax practitioners promising taxpayers refunds before they have even looked at their documents. These practitioners may use unlawful tactics to generate those refunds. “If Sars picks up any fraud, you will repay up to three times the amount you received as a refund,” warns Mkhawane. The penalty for refund fraud may be a repayment of the refund plus 200% of the amount and any outstanding interest.
YOU ARE ULTIMATELY RESPONSIBLE
Even if you use a tax practitioner to complete your return, Sars will hold you accountable. “It is important that you ask your tax practitioner for proof that your return has been submitted,” says Mkhawane. A tax practitioner should provide you with a statement of accounts and a copy of your tax return to keep on file.
PROTECT YOUR INFORMATION WHEN IT COMES TO E-FILING
Mkhawane says although the new banking verification process required by Sars has reduced the number of refund thefts, there are still cases of fraud. It is important to protect your information that could also be used for ID theft.
UPDATE YOUR BANKING DETAILS
If your refund is paid into the wrong bank account because you have not updated the details with Sars, it will not be the responsibility of Sars to correct this. As some banks recycle account numbers, there are cases where old account numbers are used and payment is made into someone else’s account.
“You cannot ask the bank for that individual’s details as it is an invasion of their privacy. If the error was not that of Sars, you would have to sue to recover the money,” says Mkhawane who adds that if the error is on the part of Sars, they will be required to pay the refund to the taxpayer and recover any losses.