Speaking to the media this week, SA Revenue Services (Sars) Commissioner Edward Kieswetter announced deadlines for tax filings, and also promised much tougher enforcement measures against non-compliant taxpayers.
“We assume most taxpayers are honest. We work to make it easy and even seamless to perform your obligations. We will be making increased use of data, machine-based learning and AI (to enforce compliance),” said Kieswetter. “We need to build public confidence and trust. We must work hard to earn it, and we were well on our way when Covid came along.”
Sars now has access to a vast number of third party databases to assist it in its job of tax collections. Kieswetter said the tax agency had access to multiple databases in SA, including medical aid records, as well as 126 million data records from the population register, the national vehicle register and other asset registers.
“We exchange information with 100 countries and receive information from South Africans who have assets abroad. We know there are more than 3 million of them. We are also expanding our mutual admin agreements with tax and customs authorities in terms of an information exchange – thereby increasing the data set.”
Kieswetter also urged government, which employs more than two million civil servants, to work with Sars to ensure compliance.
Sars has upgraded its system to allow auto-assessments for more than three million taxpayers. For most of these, assessments will be provided in three seconds, which the taxpayer can then accept or provide more information. The mass roll-out of e-filing and MobiApp filings has been accelerated during lockdown. Sars is encouraging all South Africans to submit tax returns using these online tools so as avoid the need for a visit a branch office.
“We will communicate with taxpayers through a variety of social media, and have added more than 30 digital functions to allow people to transact online. We’re using AI and machine-learning to inform how we design the platforms to create a better experience for taxpayers, and we have about 1,000 agents to conduct interviews and assist taxpayers. We’ve also virtualised our contact centres,” he said.
Visits to Sars offices are by appointment only. Branch offices have been instructed to persuade taxpayers to move from physical to online filing.
Kieswetter said while every effort is being made to give taxpayers the opportunity to correct non-compliance, the agency will act more decisively than ever before with instances of non-compliance.
He said Sars is committed to several outcomes:
- 8 out of 10 with assessment outcome in under 3 seconds, depending on the speed of the network
- Sars is committed to paying 7 out of 10 taxpayers refunds within 72 hours provided nothing else is required (eg outstanding compliance issues, address and bank details).
- Sars will inform taxpayers of exactly what information is outstanding, rather than giving a vague response
- It will conclude 7 out of 10 audits when an audit is required. The speed of the audit is dependent on taxpayer cooperation
- It will issue letters and impose penalties as prescribed in law immediately after tax filing closing dates.
- Tax relief measures are available for those who are tax compliant.
Turning to what measures Sars is takin to enforce compliance, Kieswetter pointed to the following accomplishments
- R77.7m seized in illegal cigarettes seized during lockdown, up from R15 million the previous year
- 137kgs (worth R150.7 million) of rhino horn seized at OR Tambo International Airport
- Sars detected R4.1 billion in fraudulent refunds, and R511m in preservation orders issued to secure assets related to illegal activities
- 23 cases worth R83 million were transferred to law enforcement
Filing season dates
While Covid had interrupted the normal tax filing dates, Kieswetter expressed his disappointment that since 1 May 2020, only 325,000 employer reconciliations had been received, versus the expected 567,000.
Only 262,000 of the 325,000 filings were received on time. Some employers had also revised submissions after filing date, which created delays.
“Filing season starts in August – we encourage taxpayers to make sure their tax returns are up to date, and their outstanding returns a bank details up to date,” he said.
- From 1 – 30 August: mass launch of auto-assessment. Taxpayers can log onto their MobiApp, submit their returns and accept the assessment, or review it. The process will take just a few seconds.
- Any additional information relating to the assessment can be edited and updated and then refiled. Taxpayers can use the online tax calculator to get an idea of the simulated outcome of assessment.
- Of the 62,000 e-filings received by 7am on the morning on 30 July, 12% were flagged for audit. There were a number of detected attempts to defraud Sars in terms of disability claims, PAYE and business losses, which will be referred to law enforcement.
- 1 Sept – 16 November: Taxpayers requiring assistance can contact call centres, and agents will be able to help. “As a last resort, you can make an appointment to visit a branch. We want to discourage unscheduled visits to branches because of Covid,” urged Kieswetter.
- 27 October: Closing date for those electing to file at a Sars branch office.
- 29 January: Final filing date for provisional taxpayers.