THE SARS DISPUTE PROCESS

It is increasingly important to be aware of your rights and responsibilities when it comes to SARS and the tax system.

Whether you are submitting a tax return for Income Tax, VAT, PAYE or any other tax it is vital to understand the process behind the submission and finalisation of the return and your rights therein.

Dispute Process:
When you submit a return, SARS will issue what is called an assessment. This assessment will state what tax you need to pay. It will consider the information that you have supplied to SARS as well as information that SARS has at their disposal.

This assessment can either be in line with your calculation / interpretation or not. If not then you have a choice to make, do I accept the assessment SARS has issued to me or not?

If not, then you follow the objection and dispute process: the steps are as follows:

Step 1: Submit a Request for Reasons (RFR):
To obtain from SARS the reasons for their assessment being different to your calculations.

Step 2: Submit a Notice of Objection (NOO):
If the RFR does not satisfy you i.e., you are still not in agreement with SARS’s assessment then you submit an objection to the assessment.

Step3: Submit a Notice of Appeal (NOA):
If SARS has decided to partially allow or disallow the objection, then the next step is the appeal. Here you are 3 possibilities:
1. Alternative Dispute Resolution
2. The Tax Board
3. The Tax Court

These are the basic steps that can be followed to ensure that SARS accepts your calculation and that you pay the correct tax.

Timelines:
The timelines are where the problems often lie, both the taxpayer and SARS, at times, fall foul in not adhering to the designated timelines.

As taxpayers are not always aware of the timelines, they often put pressure on the tax practitioners to “speed up the process” which is not always possible, especially if SARS is still within the required timeline.

Summary of timelines:
RFR:
You have 30 business days to submit your RFR.
SARS has 45 business days to respond.

NOO
You have 30 business days to lodge the objection from either the assessment date or the response from SARS on the RFR.
SARS has 60 business days to respond to the NOO.

NOA
You must submit your NOA within 30 business days.
SARS has 45 business days to respond to the NOA.
SARS must inform the taxpayer by notice within 30 business days of receipt of the Notice of Appeal whether the matter is appropriate for ADR.

If you calculate then you can see that the process from assessment to final outcome of the NOA can easily exceed 150 business days (around 7 months) even if the tax practitioner submits the required documents and forms without any delay.

Should SARS perform an audit, this process alone can take up to 12 months and if the NOA goes to Tax Court it could take years to resolve.

The importance of the taxpayer and tax practitioner’s speediness and accuracy is very important as any delays by either will only extend this process even longer.

You can contact us if you have any questions regarding the information above or if you would like to discuss any other financial or tax matters.

Email: pe@bvsa.ltd  | roediev@bvsa.ltd
Address: 98 Park Drive, St Georges, Port Elizabeth