The South African Revenue Service (SARS) has declared that taxpayers who fail to evaluate auto-assessments would face a one-time administrative penalty.
The revenue collector stated in a memo dated Monday (February 21) that the fines will be applied to two groups of taxpayers:
Taxpayers who were selected for auto assessment but did not accept, decline, or modify their return before filing it after SARS issued an original based on estimated return but did not accept, decline, or edit their return after SARS issued an original based on estimated return (auto). All non-auto assessed provisional and non-provisional taxpayers who filed a return after the filing season and before the recurring admin penalty was imposed.
“Just like the Personal Income Tax (PIT) outstanding return recurring admin penalty, the once-off admin penalty can be adjusted or cancelled,” it said. “As part of the admin penalty process, SARS will adjust the admin penalty amount if there’s any change to the taxable income where a once-off admin penalty was already imposed.”
It went on to say:
The taxable income may vary as a result of a revised declaration, a dispute (NOO/NOA) against a rejected or amended return that is permitted or partially allowed, resulting in a taxable income that differs from the initial taxable income used to calculate the once-off admin penalty amount. The taxpayer will receive a penalty adjustment letter informing them of the administrative penalty adjustment.
“If it has been determined that SARS has erroneously imposed the once-off admin penalty on taxpayers, SARS will cancel the admin penalty transactions and related debt and update taxpayer’s admin penalty account,” it said.