Have outstanding taxes due? Consider requesting SARS to compromise a tax debt
Did you know that you can ask SARS for tax debt forgiveness? One way you can do this is requesting a compromise from SARS to give you some room to breathe. If you're considering this option, read on to discover what you should include in your application...
With the tough economic conditions it's getting tougher to manage debt, especially if you have outstanding taxes due.
Luckily you can ease your burden and turn into SARS for help by requesting it to compromise a tax debt.
A compromise is an 'agreement entered into between you as the debtor and SARS and a debtor, allowing you to repay the debt in installments. And as long as you comply with this compromise agreement, SARS WON'T pursue you for the outstanding taxes due,' explains The Practical Tax Loose Leaf Service.
SARS will consider a compromise only if you apply for it. And there are certain things your application should contain.
Provide the following information in your request for the compromise of a tax debt
Apply in writing, sign the application and warrant that the application is accurate and complete;
Detail all assets and liabilities at their current market value;
Provide a detailed list of your income and expenditure for the last 12 months, as well as copies of your bank statements for the past 12 months;
'Provide information on the value of the assets you disposed of, how much money you got for them, the identity of the person who acquired the assets and your relationship with that person' says the Loose Leaf;
Describe any future interest you may have in the asset, whether certain, contingent or subject to the exercise of discretionary power;
Provide information on your present sources and level of income; also, the anticipated sources and level of income for the next three years, with an outline of your financial plans for the future; and
Provide reasons for seeking a compromise and any other information SARS may require.
Knowing that you can ask SARS for tax debt forgiveness by applying for a compromise on a tax debt will help you manage your debt better.