FAQs
FAQ – Frequently Asked Questions
Why did Sars issue a final letter of demand?
A Letter of Final Demand (LFD) from SARS is issued when a taxpayer has outstanding tax debts and previous notices or reminders have not been addressed. It’s essentially a formal warning that immediate payment or action is required before SARS takes further legal steps.
What is the voluntary disclosure programme (“VDP”)?
The VDP is a process regulated by the Tax Administration Act which encourages applicants to disclose their non-compliance, such as undeclared or understated income, and to give them the opportunity to become fully tax compliant.
Are there exemptions from customs or excise duty?
Yes, certain goods may qualify for exemptions or reduced rates, such as:
• Diplomatic imports
• Goods for charitable purposes
• Raw materials used in manufacturing
Exemptions are subject to strict compliance and approval from customs authorities.
• Diplomatic imports
• Goods for charitable purposes
• Raw materials used in manufacturing
Exemptions are subject to strict compliance and approval from customs authorities.
Can I dispute a duty assessment?
Yes. If you believe SARS has assessed your duty incorrectly, you can file an objection or appeal following SARS procedures.
Is a sole trader a provisional tax payer?
If your sole trader income isn’t taxed through PAYE (like employees), you must register as a provisional taxpayer. Provisional tax payments are made twice a year (August and February) to help spread your income tax liability.
Can a foreign company register for Vat in South Africa?
Where a foreign company supplies goods and services to any South African person, subsidiary, holding company or clients, it may potentially be liable to register for Vat in South Africa. Such foreign companies should obtain an opinion from a registered tax practitioner to assess if a Vat registration is required.
How long does it take to register Vat?
VAT registration may take between 5 - 21 working days, depending on whether SARS requests verification of your company details and/or premises.
What is Eti?
The Employment Tax Incentive (ETI) scheme in South Africa is designed to encourage employers to hire young work-seekers by providing a tax rebate on their wages.
What are Annual Financial Statements?
Annual Financial Statements are formal records of a company’s financial performance and position over a financial year. They include the income statement, balance sheet, cash flow statement, and statement of changes in equity.
When are financial Statements due?
Financial statements are generally due within 6 months of a company’s financial year-end, but the exact timing depends on the company type, size, and audit requirements. Always ensure FS are ready before filing tax returns with SARS.