Because Vat is a self-assessment system, SARS has to carry out audits on your returns. It wants to make sure you've correctly calculated your Vat liability. And it wants to verify if you indeed owe SARS Vat, or it owes you the amount you calculated.
If SARS believes you've made a mistake, or it makes an assumption on your return, this changes your figures on the Vat return.
You have a right to object! Read on to find out when and how to object to SARS.
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Have you received a nasty assessment from SARS?
Request the specific information it wanted from you for the audit;
Keep you informed of the progress of the audit; and
Notify you within 21 business days of its findings before it raised the assessment?
I suspect it didn't! And now it's assessed you and you don't agree.
Here's what you should do to object SARS' assessment.
If you're in the following five situations, you can lodge an objection against SARS
You can object if SARS:
1. Changes the figures of your Vat return, by an assessment;
2. Decides not to allow an extension. For example, you'll be out of the country at the time you must submit your Vat return and ask SARS for an extension, which they disallow;
3. Makes a decision you don't agree with such as it interprets a section of the law differently to the way you interpret it;
4. Doesn't make your refund. For example, your Vat return shows a refund, but SARS doesn't make the refund, or it reduces your refund for some obscure reason; and/or
5. Doesn't waive penalties where you've requested it to, with substantiating reasons.
Now that you know when you can object, read on to find out how to lodge your objection.
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Here's how to object
The most important thing to remember with lodging an objection is - you must do this on time! You have 30 days from receiving SARS' assessment or decision, to submit your objection to SARS.
For Vat, fill in an ADR1 form and give the reasons why you're objecting. Make sure you spell these reasons out clearly, so SARS can understand it in full.
Submit your objection to SARS manually. SARS now has 60 days to consider your objection.
SARS must notify you in writing of its decision. If it allows your objection, it must say so.
But if it disallows your objection, it must also say why it's disallowed it. Plus, in this letter, SARS must tell you where to address your appeal to. It must give you a name and the contact details where you can lodge your the appeal if you still don't agree with its decision.
Well there you have it, now you know when and how you can object.
One of the main reasons SARS will assess you is when you don't respond to SARS' Review of VAT201 Declaration Letter.
Don't let this happen to you! Here's everything you need to know so you can avoid losing your hard earned money to SARS.