SARS is coming after these taxpayers

Experts warned that South Africans behind on their tax obligations, who delay action on outstanding returns, ignore SARS requests, or fail to regularise their tax profile, could face escalating penalties, interest, and legal enforcement.

Fortunately, the situation can still be turned around, Tax Consulting SA senior tax consultants Rehnu Vallabh and Hlengiwe Mkhize explained to Daily Investor.

“If you fell behind on filing, payments, or responding to SARS during the 2025 tax year, you are not alone,” Vallabh and Mkhize said.

“The good news is that there are practical steps you can take to get your tax affairs back on track before the 2026 cycle intensifies.”

First, Vallabh and Mkhize urged taxpayers who have fallen behind on their obligations to act as soon as possible, since delays increase penalties.

SARS automatically charges administrative penalties for late returns, interest on outstanding amounts, and may issue final demand notices. “The sooner you act, the lower the financial impact and the easier it is to resolve,” they said.

They explained that taxpayers must also determine what exactly is outstanding. Taxpayers can check their SARS eFiling profile or ask their practitioner to confirm which returns – such as ITR12, provisional tax, VAT, and PAYE – are late.

Their eFiling profile should also show if they have any outstanding balances, and if SARS has issued penalties, demands, or verification requests. “Clarity is essential before taking the next step,” Vallabh and Mkhize said.

Once taxpayers establish what they owe, Vallabh and Mkhize said they should file all overdue returns, even if they cannot pay immediately. “SARS prefers compliance before payment,” they said.

“Filing overdue returns stops further administrative penalties from accruing for non-submission, allows SARS to issue a correct statement of account, and ensures your tax status returns to ‘compliant’.”

Even if someone owes SARS money, filing first is the most important step, they said. In addition, taxpayers who cannot pay in full can apply for a payment arrangement.

“SARS allows taxpayers to settle their tax debts over time. A formal payment arrangement can prevent legal enforcement or collection measures, allow settlement over several months, and reduce immediate financial pressure,” Vallabh and Mkhize said.

Avoiding SARS penalties

Vallabh and Mkhize urged taxpayers to respond to all SARS verification or audit requests, as failing to do so could lead to serious trouble.

If SARS has requested documents, taxpayers should upload them promptly and ensure they are complete. SARS may request documents such as bank statements, IRP5s, supporting schedules, and invoices.

“Ignoring verification requests can lead to assessments being raised on estimates, disallowed expenses, and significantly higher tax liabilities,” they said.

They added that taxpayers should also consider submitting a request to the taxman for a remission of penalties.

If the late submission was due to circumstances beyond the taxpayers’ control – such as illness, disability, administrative issues, or other valid reasons – they may qualify for remission.

“A formal RFR (Request for Remission) can help reduce or remove penalties – provided the motivation is strong and supported by evidence,” they said.

To ensure that taxpayers do not fall behind on their tax obligations in the coming year, Vallabh and Mkhize encouraged taxpayers to regularise their tax profile for 2026. To avoid repeating issues, taxpayers should –

• Confirm all personal details are up to date on eFiling
• Ensure SARS has the correct banking details
• Set reminders for provisional tax deadlines
• Maintain proper record-keeping for deductions and income

Finally, Vallabh and Mkhize advised taxpayers who have fallen behind on their obligations to work closely with a tax practitioner.