SARS Means Business - Where Will The Revenue Come From?

Written By Eszter Rapanos

This article will count 0.25 units (15 minutes) of unverifiable CPD. Remember to log these units under your membership profile.

SARS has just wrapped up the 2024/25 tax year on a high note. Despite a tough economy, the tax authority brought in a record R2.3 trillion in gross revenue. After paying out R447.7 billion in refunds (the highest ever), SARS still managed to collect R1.855 trillion—which is R8.8 billion more than they expected.

It’s clear that SARS is stepping up its game, and accountants across the country should take note: compliance is under the spotlight like never before.

So, Where Is All This Money Coming From?

SARS Commissioner Edward Kieswetter says that South Africa has a “tax gap”—basically, the difference between what should be collected and what actually comes in. This gap is estimated to be around R800 billion, with at least R500 billion of that seen as recoverable.

SARS has been running detailed studies to figure out where this gap is, especially in personal income tax (PIT), company tax (CIT), and VAT. Their estimates show large shortfalls in:

  • Personal Income Tax (PIT): R200 billion

  • Company Tax (CIT): R78.5 billion

  • VAT: R200 billion

  • Tobacco excise duties: R18 billion

Who’s Being Watched More Closely?

SARS isn’t just making general announcements—they’ve got specific areas and industries in their sights. Here’s where they’re focusing their energy:

  • Finding more taxpayers in both the formal and informal economy

  • Keeping an eye on high-net-worth individuals and crypto users

  • Cracking down on VAT fraud, trade mispricing, and illicit financial flows

  • Watching e-commerce imports (yes, even small parcels from Temu or Shein!)

  • Investigating syndicated tax crimes, including those involving gold and fuel

Dedicated teams are already working full-time on crypto, high-wealth individuals, and illicit trade.

SARS Compliance Program: What They’ve Achieved

In just one year, SARS’s compliance teams brought in R301.5 billion. That includes:

  • R94 billion from following up on outstanding debt

  • R103 billion from over 1.7 million tax verification cases

  • R59 billion from audits

  • R30 billion from big investigations, including state capture and syndicated crime

  • R15 billion from general compliance efforts

They also blocked R146.7 billion in fraudulent refund claims—thanks to smart systems powered by data science and AI.

A More Modern, Digital SARS

SARS is transforming. Nearly 5 million taxpayers were auto-assessed last year, with refunds paid in just 72 hours. And if you filed your own return, you probably got your outcome in under five seconds.

SARS is also investing heavily in digital upgrades and plans to improve taxpayer services, modernise customs systems, and recover even more outstanding debt. They’ve received R7.5 billion in extra funding over the next few years to make it all happen.

What This Means for You and Your Clients

As an accountant, your role is more important than ever. SARS is tightening its grip on non-compliance, and your clients need help staying on the right side of the law. Here are a few things to keep in mind:

SARS is now using powerful tools like data science, artificial intelligence (AI), and machine learning (ML) to track non-compliance and prevent fraud. Here’s how you can help your clients stay on the right side of the system:

  • Ensure accuracy in tax submissions
    SARS’s AI systems are designed to detect discrepancies. Double-check that income declarations, deductions, and supporting documents are correct and consistent.

  • Be proactive with client compliance
    Encourage clients to stay up to date with all their returns and payments. Machine learning models are flagging non-compliant behaviour much faster than before.

  • Review refund claims carefully
    Make sure refund claims are fully supported by accurate documentation. SARS is now better equipped to stop impermissible or fraudulent refunds—your clients don't want to be caught in the crossfire.

  • Educate clients on digital transparency
    Let clients know that their economic activity (e.g., bank flows, asset ownership) is now more visible to SARS thanks to third-party data and analytics.

  • Stay informed on system changes
    As SARS modernises its systems, keep an eye out for updates on filing procedures, new tech tools, and automated assessments that might affect how you work with clients.

In Summary

SARS has proven it can adapt, modernise, and act when needed. Whether it’s through AI-driven audits or targeted enforcement in risky sectors, one thing is clear: compliance is no longer optional, and ignorance won’t be an excuse.

Read more in the SARS Media Release: SARS is committed to serving South Africans, 1 April 2025

Eszter Rapanos
Next

EMP501 Filing Season News