The South African Revenue Service (Sars) has announced that its Voluntary Disclosure Programme (VDP) is now permanently available to qualifying individuals, companies or trusts.
The VDP allows taxpayers to regularise their tax affairs by coming clean on defaults in their tax payments or any other tax non-compliance that may lead to penalties or action if discovered by Sars.
Previously, the programme was available only during specific periods during certain tax seasons. VDPs have been part of South Africa’s tax regime since 2011, while a Special VDP was announced in the 2016/17 tax season.
Sars encouraged taxpayers who may be in default on their tax affairs to approach the revenue service via the VDP.
“By coming forward willingly, such taxpayers will receive the help and advice from Sars to expedite the resolution of their request. Where, through its own investigative processes, Sars discovers non-compliance, it will not avail this opportunity to non-compliant taxpayers but will act within the remit of the law to deal with non-compliance,” Sars said in a statement on 30 November.
Taxpayers who have tax defaults with Sars and would like to be granted relief from penalties and avoid possible criminal prosecution can voluntarily disclose their outstanding tax affairs. These tax defaults include outstanding returns, submitting inaccurate or incomplete information, failing to submit information requested by Sars in relation to any tax type that Sars administers, excluding duties and levies charged in terms of the Customs and Excise Act.
Qualifying conditions
A defaulting taxpayer will be granted relief under the programme if the application meets the following requirements:
- The disclosure must be voluntary;
- The disclosure is full and complete in all material respects;
- The disclosure involves a default that has not occurred within five years of the disclosure of a similar default;
- The disclosure involves a behaviour referred to in the understatement penalty table in section 223 of the Tax Administration Act;
- The disclosure would not result in a refund due by Sars; and
- The disclosure is made in the prescribed form and manner.
Prospective applicants can apply for VDP via eFiling.
Successful VDP applications will result in an agreement that will cover, among other things:
- The material facts of the defaults disclosed;
- The amount payable by the taxpayer, including the understatement penalty;
- The relief granted by Sars under the VDP;
- Payment arrangements and dates in respect of tax payable; and
- The fact that the relief may be withdrawn if Sars subsequently determines that the disclosure did not constitute a valid and complete disclosure under the VDP.
For more information about the VDP, email vdp@sars.gov.za or phone 0800 864 613.
