Did you get an assessment from SARS where they reversed your input tax claims and now you suddenly find you owe them VAT?
I've noticed most VAT vendors don't agree with these SARS assessments. And more often than not, SARS has gotten something wrong.
But even if this is the case, by law, you need to pay now and argue later (section 167 and 168 of the Tax Admin Act). Unless you follow my advice below to avoid paying up until after your objection is finalised.
Here's the only legal way to do so...
Take advantage of these six little-known business travel expenses you can claim input tax on
I've just finished reviewing the upcoming issue of the Practical VAT Handbook. We're sending it to the printer this week.
If you want to receive your copy, add your name to the list before midnight tomorrow.
Here's what you'll find in this issue:
Take advantage of these six little-known business travel expenses you can claim input tax on.
Find out if you qualify for an input tax claim on business travel expenses.
Two conditions you need to meet before you can claim input tax on the personal subsistence expenses.
Make sure your tax invoices meet SARS' eight requirements and claim all your business travel related expenses.
Follow these three steps to successfully claim for your business travel expenses.
To add your name to the list and get your copy sign up here
Here's how to legally avoid paying your assessment…
If you don't agree with a SARS assessment you can request a payment suspension (section 167 and 168 of the TAA
This is when SARS suspends/postpones payment of the assessed taxes because you don't agree to their assessment, and want to object or appeal. The suspension is up until the date the objection/appeal is finalised.
If you don't apply for a payment suspension, you MUST pay the assessed taxes on time. Or SARS will issue you with late fines and penalties.
Read on for five simple steps to get your payment arrangement.
How to get your VAT documentation right – first time, every time
Did you know...that in the vast majority of cases SARS has issues NOT with your interpretation of the Act, or with fancy avoidance schemes, or even with complicated transactions, but with your documentation.
This is where the most disputes, investigations and all-out battles with the assessors arise – and the crazy thing is, it's all so avoidable.
You must get your documentation right, first time, every time.
Here's the only resource that will show you how
with practical tips and explanations, checklists and actual examples of invoices and returns.
Here's what's acceptable when it comes to tax invoices
Check the assessment from SARS and their reasons for the assessment.
Did you make a mistake on your VAT return? Check your VAT account against SARS' assessment. If you didn't make a mistake, and you don't agree with SARS follow to step 3. If you did make a mistake, you need to pay SARS as soon as possible.
The TAA lets you apply in writing to SARS, to postpone your payment of assessed taxes (Section 164 of the TAA
). But this is only if you've lodged an objection or appeal against that assessment.
So write a letter to SARS asking them to suspend your payment, until the outcome of your objection and/or appeal. Get the sample letter
with important claims you should include in your application here.
Tell SARS you've raised an objection to the assessment.
Make sure your application reaches SARS within the 30 business day period you have to object to the assessment, to prevent SARS' collection proceedings.
P.S. There are eight things SARS will look at to decide if they should suspend your payment. We list them in the Loose Leaf here