Are You Ready to be a Tax Practitioner? 3 Things You Have to do Right Now
What is Tax Practitioner Readiness
The SARS Tax Practitioner Readiness Programme, developed by the South African Revenue Service (SARS) and administered by CIBA, is compulsory for all prospective tax practitioners.
The objective of the programme is to evaluate an aspiring tax practitioner’s understanding of tax administration laws and SARS operations. This assessment isn't just about enhancing your professionalism; it's about ensuring you know how to provide your clients with better service, all while sticking to the highest standards of ethics and regulations.
The Readiness Programme assessment includes 49 multiple-choice questions. To pass, you need to score at least 90%, leaving very little room for error. You'll have three shots at achieving this score, after which you'll need to wait three months for another try.
The focus of this assessment is on understanding the operational requirements set by tax administration laws and SARS processes rather than just testing your tax law knowledge.
Tips for Acing the Assessment
Approach with a Fresh Mind: Make sure you're well-rested and alert before starting the assessment for optimal performance. Don’t attempt is after work or between tasks. It requires your focused attention.
Thorough Review of Resources: Many fail to pass because they overlook the SARS videos, slides, and the CIBA guide. A solid grasp of the core concepts, legal responsibilities, and procedural steps in these resources is key to success. Have your materials handy during the assessment so you can refer to it when you are uncertain.
Read Questions Carefully: Take your time to fully understand each question and all possible answers, keeping an eye out for any that may require selecting the incorrect option as the right answer.
Concentrate On These Areas
Module 1: Legislation
Familiarise yourself with Sections 239-243 of the Tax Administration Act governing tax practitioners, focusing on the registration criteria, who must register as a tax practitioner, when do exceptions apply.
Understand the impact of various types of criminal records and pending criminal cases may have on the registration as a tax
Understand how and under what conditions complaints can be made against tax practitioners. Complaints against tax practitioners can be lodged under the Tax Administration Act for unprofessional behavior, including ethical breaches, failing to follow tax laws, or poor service. These complaints are usually submitted to the tax practitioner's Registered Controlling Body (RCB) for investigation. Valid reasons for complaints include misconduct, giving wrong tax advice, missing filing deadlines, or any actions against the expected professional standards.
Module 2: Criteria for the Recognition of a Controlling Body
Correct practices for submitting tax returns, including ethical considerations, for example tax practitioners should register clients for VAT when they become liable in terms of the VAT Act and not when it is viable for the business.
The inappropriateness of charging contingency fees for completing tax related services. A contingency fee for tax services is when a tax practitioner's payment depends on the result they achieve, like getting a tax refund or reducing tax liabilities. They might charge a percentage of the refund or savings as their fee. While this can motivate the practitioner to aim for the best outcome, it's subject to conflict of interest and can result in manipulation of tax affairs.
The consequences of misconduct and how it affects RCB registration. If a tax practitioner engages in misconduct, such as filing fraudulent tax returns or failing to comply with tax laws, the consequences can be severe. For example, the practitioner could face disciplinary actions from their RCB, which may include suspension or revocation of their registration. Losing RCB registration means the practitioner can no longer legally offer tax services, significantly impacting their career and reputation. Additionally, they might be subject to fines, legal penalties, and could even face criminal charges depending on the severity of the misconduct. This not only affects the individual's ability to practice but also serves as a deterrent to ensure that tax practitioners adhere to ethical and legal standards.
Module 3: How to Register as a Tax Practitioner
The process and importance of registering and configuring tax practitioner profiles on eFiling. eFiling is an online platform provided by SARS that allows individuals, companies, and tax practitioners to submit tax returns, declarations, and other related services electronically. This user-friendly system is designed to make the process of managing tax obligations more efficient, secure, and convenient, enabling users to handle their tax affairs from anywhere at any time.
Distinctions between RCB membership and SARS registration as a tax practitioner and the fact that a tax practitioner should be registered with an RCB and also with SARS.
Roles and permissions management on eFiling for secure and efficient operation, for example, sharing passwords.
Module 4: Becoming SARS Ready
Know the correct use of Power of Attorney and how to manage client eFiling profiles effectively. A Power of Attorney in the context of working as a tax practitioner is a legal document that grants the tax practitioner the authority to act on behalf of a client in tax matters. This document specifies the types of actions the tax practitioner is allowed to perform, such as filing returns, making tax payments, or representing the client in dealings with SARS.
Tax type transfers and the responsibility for managing client eFiling profiles. The different tax types applicable to the client i.e. for VAT, employees tax, income tax etc., should be transferred from the client to the tax practitioner’s profile.
The significance of assigning the right user permissions on eFiling ensures that only authorised staff member with the correct user rights can see or change tax information. It protects against unauthorised access and ensures tasks are correctly shared within a team for better workflow and data safety.
Module 5: SARS Channels of Engagement
Get acquainted with the functions of the SARS Contact Centre and how to efficiently resolve queries using SARS's digital platforms. Take note of the table in the SARS guidance and see what functions are applicable to the SARS Contact Centre and other channels.
Module 6: Using eFiling
Understand the role and how to manage the activation process of Registered Representatives through eFiling. Who are registered representatives and what is the difference between them and tax practitioners. The fact that they cannot be one and the same person.
Functions and limitations of the SARS Contact Centre and strategies for efficiently resolving queries through SARS's digital channels. The fact that you have to exhaust all possible digital channels before calling the SARS Contact Centre.
When reaching out to SARS, consider the best time to contact them and make use of callback requests wisely. Tax practitioners should remember that it's up to them to follow up on their inquiries; don't count on the call center to make multiple callbacks.
Module 7: Tax Season Tools - e@syFile
Capabilities and limitations of e@syFile, including payroll file management and submission of tax returns. e@syFile is a software application provided by the South African Revenue Service (SARS) designed to facilitate the submission of employer declarations, including IRP5/IT3(a) certificates, EMP201 monthly declarations, and bi-annual reconciliations. It's particularly useful for managing IRP5 reconciliations, a critical task for employers to ensure accurate tax reporting for their employees.
The process for obtaining and using Income Tax numbers via e@syFile.
Module 8: Disputes, Complaints and Debt Management
Difference between lodging complaints and dispute resolution. Lodging complaints with SARS generally involves expressing dissatisfaction with the service received or handling of tax matters, such as delays or unresponsiveness. It's about the service quality. In contrast, dispute resolution is a formal process used when there's disagreement with a tax decision made by SARS, such as assessments or penalties. It's a structured legal process aiming to resolve specific tax-related disputes through objections and appeals.
Understand SARS' processes for debt management. SARS has a structured approach to managing tax debt, offering several mechanisms to assist taxpayers in settling their outstanding dues. These include payment arrangements allowing taxpayers to pay off their debt in installments, and compromise agreements where SARS may agree to accept a lesser amount. SARS aims to work with taxpayers to find viable solutions for debt settlement, ensuring that obligations are met without causing undue financial strain.
The significance of maintaining tax compliance in dispute resolution. Maintaining tax compliance is crucial during dispute resolution. SARS is more likely to engage positively with taxpayers who have a history of compliance. Being up-to-date with filings and payments, even if disputing a specific assessment, demonstrates good faith and may influence the process's outcome favorably. Compliance shows willingness to adhere to tax laws, potentially leading to a more amicable resolution.
Understand when case numbers are not needed to lodge a complaint. Not all complaints to SARS require a case number. Complaints about the behavior of SARS staff or policy grievances can be made without one. These complaints are typically about service quality or procedural issues, not specific to an individual's tax case. However, for most service-related or tax-specific issues, having a case number is essential for tracking and resolving the complaint effectively.
The role of the Tax Ombudsman and the process for escalating complaints beyond SARS's internal mechanisms. The Tax Ombudsman acts as an independent check on SARS, providing taxpayers a means to escalate unresolved complaints beyond SARS's internal mechanisms. If a taxpayer feels that their complaint has not been adequately addressed by SARS, or if there's undue delay, they can approach the Tax Ombudsman. The Ombudsman evaluates the complaint, ensuring fairness and adherence to tax laws and procedures, offering taxpayers an additional layer of protection and oversight.
Wrapping Up
Should you need any assistance as you navigate through the Tax Practitioner Readiness Programme, the CIBA Technical Unit is here to help. Don't hesitate to reach out for any support or questions you might have. We're committed to ensuring you have a smooth journey through the programme with all the support you need.
Up your game with CIBA - become a tax practitioner!
CIBA tax licenses demonstrate the competency level of a CIBA designation holder to either compile or advise on tax related matters, and assess the practitioner’s commitment to providing ethical tax services. CIBA offers 2 licenses:
Licensed Tax Practitioner: Compiler
Licensed Tax Practitioner: Advisor
The objective of this license is to equip Business Accountants to:
Be able to apply with SARS as a tax practitioner.
Understanding of members responsibilities when performing tax services.
Understand CIBA’s Statement of Standards on Tax and promote their uniform application within a tax firm.
Foster increased public compliance with and confidence in our tax system through awareness of good standards of tax practice.
Enhance the business accountant professional designations.
Use the license as proof of competency to provide tax services.
