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Is your tax debt choking your company? Ensure you have these ten items before you ask for a write off

by , 16 July 2014
When times are hard, all the expenses you have to pay really stack up. They can start to get out of control and, when that happens, the first thing you may try to avoid paying is your tax.

It's not that you don't want to pay your tax, you're just not in the financial position to do so. After a while, this adds up into tax debt and SARS doesn't like it when you owe it money.

Luckily, SARS also understands the toll financial difficulties can take on a company. This is why you can apply for a tax debt write off, just ensure you have these ten items before you do...

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Never apply for a tax debt write off without these ten items

1.       Your clear request to waive all or part of your outstanding tax debt. You must include your reasons for asking for this.
2.       Evidence that supports your claims that you can't pay off your tax debt.
3.       A detailed statement of assets and liabilities. This must include South African and foreign assets and liabilities, and its current market value.
4.       Your accounting records showing income and expenditure from the 12 months before your application.
5.       A list of all your interests in property or funds that you've disposed of during the three years before your application for the tax write off.
Include the value of all the property and funds you disposed of. Also add the name of the person who bought these assets and the details of any relationship between you.
6.       Details of any possible future interest in property or funds (e.g. donation, inheritance or distribution from a trust). Include interests that are certain and those subject to any contingency or discretionary power.
7.       A list of all property and funds that you have any direct or indirect power of disposal over (e.g. as trustee).
8.       A list of all entities you control.
9.       Accounting records of your present and likely future sources of income and their amounts.
10.   An outline of your financial plans for the future.
If you have all of these documents you're more likely to be successful with your application for a tax debt write off.
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·         All the definitions and legal regulations, useful advice, exceptions to the rules that help you slip through the legislative jungle of taxes.
·         Case studies and practical examples that show you what elements you should consider for your taxes to be perfect.
·         Red flags you need to watch out for and the penalties you'll face if you don't respect them.
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