Consequences of coming clean with Sars | Fin24
 
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Consequences of coming clean with Sars

Oct 01 2013 19:41
Fin24
Cape Town - A successful application under the voluntary disclosure programme (VDP) of the South African Revenue Service (Sars) is not an amnesty, a tax expert warned on Tuesday.

A successful VDP application could, however, bring relief from penalties, additional taxes and criminal prosecution, said Willem Oberholzer, CEO of Probity Advisors and AccTech Consulting.

The purpose of VDP is to boost voluntary compliance and give applicants an opportunity to get their tax affairds back on track.

Oberholzer explained that the underlying purpose of VDP still remains collecting the full capital amount of taxes payable to the state by law.

Sars received 1 200 VDP applications in the financial year 2011/2012. This figure is estimated to be substantially higher in the 2012/2013 financial year.

“Any person, whether in a personal, representative, withholding or other capacity, may apply for voluntary disclosure relief,” he said.
 
"VDP offers an opportunity for taxpayers to come clean with Sars, but incomplete applications could have dire consequences.”

Oberholzer said the question is to what extent advisers and public officers will be held accountable for incomplete applications, along with the directors and custodians of the company.

"There are many examples of nefarious tax practices such as retrospective and sometimes excessive management fees, intergroup interest and profit shifting that fall under the definition of a 'default' as defined in the Tax Administration Act," said Oberholzer.
 
"The fact of the matter is that a complete VDP application will enable you to regularise your tax affairs, but it is not an absolution of your tax debts owing.”

- Fin24

tax  |  money
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