Are You Struggling to Get Your Tax Refund?

There is a feeling that taxpayers are getting fed up over the amount of tax they have to pay. Add to this the adverse publicity SARS has received as one of the focal points of the current political struggles and the string of suspensions/dismissals of senior SARS officials.

Despite this, statistics for the months April to July show that government finances are on track to deliver on the Budget outlined by the Finance Minister in February. True, collections are a little down but this is more than offset by lower government spending.

 Tax refund delays – what’s going on?

One of the cornerstones of the efficient systems run by SARS is the speed at which tax refunds are paid – normally 48 hours after an assessment is made or a verification process is completed. Yet there is a steady stream of complaints from taxpayers and the financial press of frustrating delays experienced by taxpayers due a refund.

Taxpayers due refunds are finding themselves subject to verification processes which is standard. What frequently happens is a taxpayer being asked to personally go to a SARS office with their FICA and banking details. Many are being asked to do this more than once and discovering there is still no tax refund. Tax practitioners are also finding that their clients have been placed on “Special Stoppers” and neither they nor the client are informed. In many instances the frustration is exasperated by unclear or a total lack of communication and clarification from SARS.

SARS has increased their controls over refunds due to increasing criminal activity and the high amount of fraud taking place. They have been ambivalent, though, in their explanation for the actual refund delays – on the one hand admitting there is a problem but then stating that these delays relate to 5% of tax submissions and taxpayers must expect delays.

 Some light at the end of the tunnel – perhaps

SARS has been promising an updated Tax Service Charter which hopefully will be released soon and will address this issue. There is a proposal before Parliament that the Minister may direct the Tax Ombud to investigate “systemic issues” relating to service.

In the meantime, taxpayers suffer the cash flow consequences. This is particularly severe on small businesses and individual taxpayers and addressing fraud without collateral damage is becoming a matter of desperate urgency.

Please note that SARS has now implemented a new special stopper on most income tax refunds, and requires the taxpayer to verify their bank details at their nearest SARS branch before any refund will be paid out by them. There are 2 options available should this happen to you:

The following documents must personally be taken to SARS by you:

  • Your original ID document
  • Certified copy of your ID document
  • Original bank statement, with bank stamp, confirming your personal bank details (Not older than 3 months)
  • Proof of your residential address – see attached list of documents that will be accepted by SARS

Alternatively, we as tax practitioners can make an appointment at SARS and do the above on your behalf.

In which case the following applies:

  • Our fee of R750.00 excluding VAT will be charged.
  • Please note that tax practitioner’s appointments at SARS are subject to availability and are currently limited as we reaching the end of the year. Therefore please check with us in advance should you wish to follow this route.
  • A SARS Power of Attorney form must be signed by you so that we can submit the request on your behalf – Please contact us so that we can prepare the form and send it to you.
  • The signed Power of Attorney form together with all of the above needed documents must be delivered to our office.