The eight instances you can lodge an objection with SARS and win!
Here's a true story with a happy ending:
I had coffee with Peter Franck, Contributor of the Practical VAT Handbook, and he told me an interesting story about one of his clients, Mr Hogenboezem*. He received a VAT assessment for R86 000 from SARS. SARS issued him with this assessment because he mistakenly claimed input tax twice on a bakkie and the invoices he received for purchases were technically incorrect.
This assessment was as much as his monthly turnover. So, he disagreed with the assessment and wasn't willing to pay. Luckily, he did the smart thing and lodged an objection. SARS reviewed the objection and eventually withdrew the assessment. Mr Hogenboezem was successful in his objection and didn't have to pay SARS a single cent!
Read on to find out when you can also lodge an objection and win.
Does a SARS' assessment say you owe them money?
Don't pay it just yet! Ask SARS to suspend your payment in two simple steps.
But you need to get this right, or you'll incur unnecessary penalties.
If you disagree with an assessment – then lodge an objection
You too may get a VAT assessment from SARS that you totally disagree with. Many people decide to keep quiet because they think they don't stand a chance against SARS.
Don't make this mistake!
If you have a valid reason to object – then do it!
Here are the eight instances when you can lodge an objection and have a happy ending like Mr Hogenboezem did.
Pretoria East Motors didn't bow to SARS assessment of R5 million, so why should you?
SARS raised several assessments on Pretoria East motors (PEM). They said 'many motor dealers often make mistakes'. So they decided to carry out extensive audits on Pretoria East Motors.
SARS assessed PEM on 9 separate items and said due to the number of disputes, PEM was trying to evade tax and slapped a fine of 200% on top which came up to R5 million!
But PEM wouldn't just accept SARS' assessment. They put in an objection and the assessment was reduced to only R1 million.
So, don't just accept assessments and penalties from SARS. Object to a SARS assessment in four steps
hen can you lodge an objection with SARS?
You can lodge an objection if SARS:
1. Changes the figures, by an assessment, of your VAT return;
2. Makes a decision you don't agree with;
3. Doesn't give a refund;
4. Doesn't waive an administrative penalty;
5. Doesn't waiver a non-compliance penalty;
6. Doesn't waiver an understatement penalty;
7. Gives you an assessment you don't agree with; and
8. Decides not to allow an extension for a late objection.
So do the right thing if you have a disagreement with SARS - lodge an objection. You could save thousands.
Mr Hogenboezem did the smart thing and you can too, by lodging an objection. Want to know how to lodge an objection? Then simply turn to chapter O 01/003 in your Practical VAT Handbook. If you don't own one, then order your copy now!
*Please note this is not the client's real name