The South African Revenue Service (SARS), in terms of the Tax Administration Act No. 28 of 2011, has made provision for the Voluntary Disclosure Programme (VDP) to be permanently available to a qualifying individual, company or trust that seeks to voluntarily disclose and regularise their tax affairs. This step is aligned to the SARS’ strategic objective, which seeks to provide clarity and certainty as well as make it easy and seamless for taxpayers and traders to comply with their obligations.
SARS would like to encourage all taxpayers who may be in default on their tax affairs, to approach SARS via the Voluntary Disclosure Programme. By coming forward willingly, such taxpayers will receive the help and advice from SARS to expedite the resolution of their request. Where through its own investigative processes SARS discovers non-compliance, it will not avail this opportunity to non-compliant taxpayers but will act within the remit of the law to deal with non-compliance.
SARS is firmly committed to the pursuit of strategic intent, which is to promote voluntary compliance whilst lowering the cost of compliance. To this end, we want all taxpayers to understand that they always have an opportunity to regularise their tax affairs. While voluntary compliance is our first preference, SARS is refining its capability to detect and make it hard an costly for non-compliant taxpayers.
Taxpayers who have tax defaults with SARS and would like to be granted relief from penalties, and avoid possible criminal prosecution can voluntarily disclose their outstanding tax affairs. Tax defaults, range from outstanding returns, submitting inaccurate or incomplete information or the failure to submit information to SARS requested in relation any tax type that SARS administers, excluding duties and levies charged in terms of the Customs and Excise Act, 91 of 1964.
The Voluntary Disclosure Programme is a unique opportunity for defaulting taxpayers to regularise their tax affairs, SARS encourages concerned taxpayers to make use of this legal instrument.
A defaulting taxpayer will be granted relief under the programme if the application meets the following requirements:
- The disclosure must be voluntary;
- The disclosure is full and complete in all material respects;
- The disclosure involves a default which has not occurred within five years of the disclosure of a similar default;
- The disclosure involves a behaviour referred to in the understatement penalty table in Section 223 of the Tax Administration Act;
- The disclosure would not result in a refund due by SARS; and
- The disclosure is made in the prescribed form and manner.
Prospective applicants can apply for VDP via SARS eFiling.
Successful VDP applications will culminate into an agreement that will cover amongst others:
- The material facts of the defaults disclosed;
- The amount payable by the taxpayer including the understatement penalty separately reflected;
- The relief granted by SARS under the Tax VDP;
- Payment arrangements and dates in respect of tax payable; and
- The fact that the relief may be withdrawn if SARS subsequently determines that the disclosure did not constitute a valid and complete disclosure under the Tax VDP.f
Source: sars.gov.za
