Is your company battling to get on top of tax debt? If so, then it's worth noting that you have a solution!
I'm talking about a tax compromise, and you should definitely use it!
You see, SARS would much rather make a compromise and get some tax out of you than risk getting nothing at all.
But you need to keep in mind that SARS will only grant a tax compromise if this 1 important condition is met...
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At the end of the day, SARS wants to ensure that it will receive the highest net return on any outstanding tax debt.
This basically means that they want to get as much money as they can into their bank account. And if the compromise is that answer, then it will accept your application.
In order to determine whether or not to give you a tax compromise, SARS will consider various factors, such as whether…
they'll get more money in the courts as opposed to a compromise, and if they'll get more money if they sequestrate or liquidate you; and whether
the tax debt will take longer to recover if they give you the compromise, as opposed to other means. etc.
What does this mean?
When applying for a tax compromise, you can't be the one who benefits at SARS' expense. The compromise must be in the interest of SARS.
An application for a tax compromise can be submitted at any time of the year, and should be done as soon as you realise you can't pay SARS any outstanding tax debt.
*That was the 1 vital condition you must meet to have a chance of receiving a tax compromise from SARS.
To learn more, page over to Chapter T 18: Tax Compromise
in your Practical Tax
handbook, or click here
to order your copy today.