If you're entitled to a VAT refund, then you better ensure SARS has your banking details.
Read the following case of when SARS posted a cheque and LOST it, resulting in a huge delay in the refund process and a complete change in the law regarding YOUR responsibility regarding VAT refunds...
Stabilpave vs. SARS (Supreme Court of Appeal) 26th September 2013:
On 16 October 2006, SARS told Stabilpave they were entitled to VAT refund of over R700 000.
But SARS didn't have their banking details, so they posted a cheque.
But, unfortunately, the cheque was intercepted by a fraudster, and the money was lost.
Keep reading to find out what happened next…
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SARS then claimed that since Stabilpave didn't provide their banking details, it tacitly implied that SARS had permission to post a cheque.
However, and luckily for Stabilpave, the Court noted that they hadn't requested a cheque, and so the responsibility rested in SARS' hands. In other words, they had to refund Stabilpave, again.
BUT it wasn't all smooth sailing from there on out, because Stabilpave had to wait 7 years to receive their refund! This was because they had to go to the High Court AND the Supreme Court of Appeal in order to get a ruling which fell in their favour.
Can you learn from this case?
SARS has since made it compulsory to only give refunds in the form of direct electronic transfers to companies' bank accounts.
They also made some changes to the rules, transferring the risk of refunds to you, the taxpayer.
So if you give SARS the wrong banking details, or if your banking details change and you don't update your details with SARS, then YOU will incur the losses!
So don't make that mistake, ensure that your banking details are correct with SARS and always make relevant updates with SARS, where necessary.
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