Sars withholds tax refunds

Pretoria - The 2008 tax assessment process has not been adequately explained, leading to unnecessary frustration on the part of taxpayers.

The situation won't be repeated this year. This is the response by the South African Revenue Service (Sars) to taxpayers' complaints that they were still waiting for their refunds months after receiving the assessments.

Sars spokesperson Adrian Lackay says the main reason for withholding refunds is because information supplied by the taxpayer does not agree with Sars' records.

Sars issues the taxpayer with an assessment letter based on information supplied by the taxpayer.

"If Sars finds discrepancies between its information and what the taxpayer has supplied, it reckons that the onus is on the taxpayer to supply the supporting information to motivate why the refund should be made."

The refund is not made until all the information has been provided.

In the previous tax season taxpayers were under the impression that their refunds should take place after they had received their assessments.

Lackay says the taxpayer will still receive an assessment letter this year. If the information in the return does not agree with that in Sars' possession, the assessment will indicate that no refund will be made before supporting documents can be examined.

The assessment letter will be accompanied by a second letter indicating that the refund is being withheld, as well as the information required before payment is effected.

"This process can - because it is done manually - take up to three months to complete, and it starts only when the documents have been supplied to us," Lackay explains.

He says full audits can take from three to twelve months, depending on the complexity of the taxpayer's affairs.

A total of 150 000 refunds have been withheld because faulty bank details were supplied.

- Sake24.com

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