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What to do if SARS wants to audit your company records

by , 06 December 2013
SARS is empowered to come to your premises to conduct a field audit or criminal investigation. This means they can request to audit your company records. Here's what the law says you must do when the taxman requests an audit on your records at your premises.

It's important that you get your records in order and take note of the time frames you need to keep them for before SARS comes round for a visit.

In addition, you must know what's required of you when SARS wants to come to your premises to audit your records.

With a record audit at your premises, you'll need to know the following:

#1: A senior SARS official must notify you, at least 10 business days before they intend to turn up.

The Practical Vat Loose Leaf Service says the official must notify you about the following:

  • The venue, date and time (which must be during business hours) when they'll start the audit. If that date's not desirable for you (such as if it's month end, year-end or your accountant is off on maternity leave), you must let SARS know five days before they're due to arrive to change the date of the visit.
  • What they're coming to check. They must say what tax period they want to see records for, and if they're checking output tax, input tax or both.

#2: The audit must be in connection with a tax act and only relevant material may be asked for;

#3: Only a SARS official can carry out audits. They must demonstrate their authority to do so by showing identification if asked.

#4: SARS may NOT enter your house or residence without your consent, unless it's a portion of a house used for trade

In terms of the Tax Administration Act (TAA), you're obliged to assist SARS with:

  • Making available facilities for them to work from;
  • Making photocopies for them. The TAA lets you recover the costs of photo stats from SARS after the audit is completed;
  • Answer questions relating to the audit (ask for these to be put in writing);
  • Submitting relevant material as required;
  • Not obstructing SARS from doing their work; and
  • Not refusing to give them assistance.

That's not all.

If SARS asks for access to your records, you'll need to provide evidence of your Vat compliance in the following four easy ways:

Four ways to provide evidence of your Vat compliance if SARS asks for access to your records

  1. Show the rate of Vat you applied to the supplies, whether 14% or 0%;
  2. Provide valid tax invoices;
  3. Show the relevant books of account; and
  4. If you've applied the zero-rate on items you've sold, keep a record of anything that'll support your claim, like export documentation.

Well there you have it. Knowing what to do when SARS wants to audit your company records will help ensure you comply.

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