In a country where the tax authority, SARS, holds the power to issue third-party appointments, non-compliant taxpayers risk losing more than just sleep.
Jashwin Baijoo
Head of Strategic Engagement & Compliance at Tax Consulting SA
While most taxpayers dutifully comply with their tax obligations, there are numerous instances where others find themselves in conflict with the revenue collector. Occurrences of detrimental third-party appointments, where SARS seizes assets from non-compliant taxpayers are plentiful. In some instances, these cases escalate to legal battles fought in the High Court of South Africa.
But fear not! The attachment of emptying of your bank account is not the final battle. It is but one victory in the greater war on non-compliance. If SARS does not follow the correct collection procedure, as outlined in the Tax Administration Act, 28 of 2011, South African taxpayers and their trusted advisors, are fully armed to reclaim their lost fortunes.
While SARS undoubtedly holds the high ground, both morally and strategically, in the ongoing war against non-compliance, they are not unbeatable, especially when correct collection processes were not followed.
To tactically combat SARS’ expert generals, taxpayers need to understand that a third-party appointment allows SARS to retrieve money directly from financial institutions and other third parties that have control or possession of your funds. While a powerful weapon in SARS’ arsenal, it is crucial that the correct procedures are followed to ensure lawful and fair processes.
SARS, like any war combatant, must adhere to the rules of engagement when issuing third-party appointments, as outlined in the Tax Administration Act, 28 of 2011, being:
Although the attachment of funds from your bank account is a setback, it is not the end of the war, but merely ground lost. Thus enters the heroes fighting for justice: taxpayers, assisted by their tax and/or legal representatives, have the right to challenge SARS to a duel of procedural fairness. A crucial step in the broader war against non-compliance.
When duelling SARS, it’s mission critical to ensure your troops are rallied and you are armed with the strongest available firepower: evidence that SARS did not follow correct procedure.
Legal representation ensures accurate understanding of procedure and increased chances of success.
While tales of SARS’ war on non-compliance may strike fear into the hearts of South African taxpayers, you do not have to be a casualty of war. By understanding the procedure outlined within the Tax Administration Act, taxpayers and their allies are empowered to protect their rights. Where lawful collection procedure is not followed, the path to reclaiming attached money lies in seeking counsel and calling upon seasoned experts to back you all the way.
This will ensure the necessary steps are taken to protect yourself, and your war chest, from falling victim to a late-night SARS raid, or even worse, being handed over for external debt collection!
Ideally, all correspondence received from SARS should be immediately addressed by a qualified tax specialist or tax attorney. This will serve to build up your defences, as well as protect your financial interests against SARS implementing collection measures.
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