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Taxpayers are seldom happy to receive a notification from the South African Revenue Service (“SARS”). This is especially so when SARS decides to issue an additional assessment which brings about an additional tax liability.

What leads to an additional assessment?

SARS may issue an additional assessment if they believe the original assessment doesn’t reflect the correct application of tax laws. This means less tax collected than otherwise would have been.

However, a taxpayer may not know why their tax liability has increased or may disagree with the assessment. Taxpayers often forget about or ignore the request for additional assessment, causing them to wait until it’s too late to query or dispute it. This article outlines some basic timelines taxpayers should be aware of when issued with an assessment.

Your right to question

A taxpayer may request reasons for an assessment from SARS within 30 business days before lodging an objection. This period may be extended if SARS is satisfied that reasonable grounds exist for the delay.

A taxpayer can expect SARS’s response to their request for reasons within 45 business days of the request submission date (unless exceptional circumstances exist). Notably, the reasons provided by SARS must be adequate for a taxpayer’s ability to formulate an objection.

Suppose the taxpayer is still aggrieved with the assessment after reasons given by SARS, they have 80 business days after delivery of the reasons to object to an assessment or 80 business days after the assessment if reasons have not been requested. A senior SARS official may extend the period for lodging an objection if reasonable circumstances exist for the taxpayer’s delay in objecting.

While the dispute process may appear simple, it’s riddled with pitfalls that can easily derail a taxpayer’s efforts. Both taxpayers and tax practitioners sometimes make procedural mistakes that can lead to their cases being dismissed before they are fully evaluated. Therefore, it’s crucial to act swiftly upon receiving an assessment. Taxpayers should promptly determine whether they need assistance or if they can handle the matter on their own.

Being tax efficient is an important part of great financial management. In this blog, a group of South African tax experts at AJM Tax share their tips and explanations on tax issues. Learn everything you need to know about tax, from deductions you never knew about to retirement savings and capital gains. The first Tuesday of every month is Tax Tuesday.