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Admin Penalty on Tax Returns

An admin penalty on tax returns is incurred when you do not meet various requirements. The admin penalty is currently only collected for the late submissions of tax returns or no submissions at all.The admin penalty consists fixed amount penalties and a percentage based penalty.

The penalty amount that will be charged depends on your taxable income. It can range from R250 up tp R16000 a month for each month that the non-compliance continues.

What if you don’t agree with the Admin Penalty on tax returns?

If you have an admin penalty and you don’t agree with it, you have thee right to dispute it by sending in a Request for Remission (RFR01) to SARS.

If the Request or Remission isn’t allowed or only a portion was, you still have the right to object to the decision. You may even go as far as to appeal the decision if you disagree withe the outcome of the objection process.

Please be aware that you cannot use the objections process before the Request for Remissions is submitted and considered.

Admin penalties recur each month that the tax payer is non-compliant. This process can carry on for as long as 35 months. Each recurring penalty will have a unique transaction number. When SARS is dealing with an objection or appeal, partial repayment may even be allowed. This means that certain transaction may be settled.

 What if I don’t pay my admin penalty on tax returns?

If you don’t pay your debt by the due date then SARS is allowed to recover money held by third parties on behalf of the taxpayer.

If you didn’t respond to any of the notices or demands about your outstanding debt, SARS may appoint your employer or any other third party who holds money on your behalf or owes you money. This includes your salary, wages and other types of remuneration.

If a third party fails to pay any of the money, the third party will be held personally liable for the tax debt and it is also guilty of an offence. The individual is subject to a fine or to imprisonment for not longer than two years.