SARS Promotes e-filing for VAT

SARS will no longer be posting VAT returns to vendors who haven’t registered for e-filing. As of April this year, VAT vendors who are not e-filing have to visit their nearest SARS office to obtain their VAT returns.

This stance by SARS will achieve two results of which only one was intended, says a tax partner at a global audit, tax and advisory firm “The intended result that more VAT vendors register for e-filing will probably be achieved as experience shows that most taxpayers prefer to avoid visiting SARS offices unless absolutely necessary!”

However, another, unintended result will probably also be achieved, he says, that of making it more expensive for many vendors to comply with their VAT responsibilities. While it can be argued that most vendors, especially those in or near large cities, have access to the internet and can register for e-filing, not all vendors have that access, nor the ability to navigate the SARS website.

“It’s also likely that these are the vendors that find it most difficult to visit SARS for a hard copy of their return, as the nearest office is located some distance away from where they’re trading.”

Apart from the fact that many will have to incur additional costs to either acquire access to the internet or travel large distances to obtain their forms, many are likely to do neither, and therefore would be in a position where they submit their VAT returns late or not at all. This non-compliance may result in penalties and interest.

It’s understandable, even commendable, he says, that SARS wants to reduce its operational costs through limiting stationery and postage costs. The ease of use and effectiveness of administering one’s tax affairs on the e-filing system is also hard to dispute as, to date, it appears to have a fairly good track record.

“However, it’s well known that South African taxpayers are not all equally large, sophisticated or have the same access to technology, their respective SARS offices or even advisors that could assist them in navigating the South African tax system. Which makes SARS’ decision to promote e-filing in this way quite puzzling,” he concludes.

TAXtalk: www.taxtalk.co.za

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