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Why Prince Charles is happy the taxman isn't looking at his bank account...

by , 07 November 2013
If the UK's Parliament's Public Accounts Committee has its way, Prince Charles may see his multimillion pound income under the tax microscope. He earns a vast income from the Duchy of Cornwall estate, which he uses to pay for his private and public activities. But the estate pays no corporation tax and no CGT either. And lawmakers in Britain think it should. Locally, SARS has made it clear it already targets the high-rollers, the tax evaders and the big fish who have the means to evade taxes they should be paying.

According to the tax experts at the Practical Tax Loose Leaf, any of the following qualifies as tax evasion:
·         If you try to evade tax or you assist someone else to evade tax or get a refund that's not due;
·         If you make or allow any false statement or entry in your tax return or any other document you submit to SARS. Or if you sign a statement, return or other document you've submitted without reasonable grounds for believing them to be true;
·         If you receive a request for information from SARS and you give a false answer, either verbally or in writing;
·         If you either prepare or keep false books of account or other records or if you authorise someone else to falsify these books of account and other records;
·         If you are fraudulent or allow someone else to be fraudulent; or
·         If you make any false statement to get a refund or to be exempt from tax.
Tax evasion is a serious crime. One that could land you in jail for five years!
We all make mistakes; and sometimes they result in us not paying the correct amount of tax, or failing to pay on time.
If you pay any of the taxes imposed under any tax Act late, SARS'll impose a percentage based penalty. This is over and above any other penalty or interest that's already been levied.
The percentage of the penalty is set out in the relevant tax Act. For example, it states that SARS must impose a 10% penalty for the late payment of employees' tax.
This penalty is only calculated as a percentage of your unpaid taxes. It doesn't include any administrative penalties in the calculation.
So let's say you owe SARS R10 000 in PAYE. And you forgot to pay it on time. SARS will penalise you 10% of this outstanding PAYE amount. When you submit your next return and pay your PAYE, you'll pay the following: R10 000 (PAYE owed) + R250 (admin penalty) + R1 000 (percentage based penalty) = R11 250.
Paying your taxes correctly and paying on time costs you less in the long run. So make sure you get yours right to avoid the hefty consequences. 

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