There may come a time when your business doesn't have money to pay their VAT liabilities. And if this is case, don't ignore it!
You still have to submit VAT returns, otherwise you'll face penalties, interest and jail time.
So then, if you see on your VAT return that you must pay SARS, but you simply cannot afford to, then
you should follow these 6 steps, as recommended by SARS:
Step#1: Don't forget your VAT return
Even if you know you can't pay, you must still submit your VAT return(s).
If you don't submit your returns on time, you're guilty of a serious offence, which can amount to a R80 000 fine or two years in jail.
Step#2: Visit your SARS office
Go to the SARS client services centre in the area where you're registered for VAT and tell them exactly what your situation is.
Step#3: Give a detailed explanation of your situation
Clearly lay out your circumstances in writing. Here you'll explain why you can't pay the VAT, after which you'll make a proposal as to how you'll be able to settle the particular amount.
Step#4: Give SARS your up-to-date financials
Filling in the wrong block on your VAT return, will trigger the 'Dear Vendor' letter
SARS tell you your VAT201 declaration has been identified for verification. It wants you to review your VAT201 and submit corrections.
DON'T just upload all your documents!
Or you'll give SARS permission to grab money from your business bank account!
Here's what you should do…
Put together a statement of your income and expenditure, as well as an up-to-date statement of your assets and liabilities.
Step#5: Get all your paperwork in order
Make a copy of your latest bank statement and take it with you to SARS.
Step#6: Consult with SARS
When you do meet with SARS, explain your situation both in writing, as well as verbally.
Discuss your proposal for settling the amount in question with a SARS official.
Remember that SARS will allow you to settle your VAT account over a period of time. This period depends, of course, on your circumstances.
But also keep in mind that SARS won't allow you to settle your VAT account over a period of time if you've ever been found guilty of evasion.
Do you want to minimise your VAT bill?
The Practical VAT Loose Leaf Service Will Allow You To Calculate VAT Efficiently And Take Advantage Of Little Known, Legal, VAT Saving Strategies
· Explain the latest changes in VAT
· Save you R1000's in time and money
· Tell you how to use specific VAT benefits in practice
· Show you which deductions you can make
· Demonstrate how to deal with SARS audits
· Protect you from typical mistakes made when calculating and paying VAT and how to avoid them
· Show you how to identify legitimate VAT invoices
· Will show you how to keep your VAT payments up to date
Get your copy here…