SARS can collect outstanding taxes and administrative penalties from financial investments
SARS can collect outstanding taxes and administrative penalties from financial investments
The South African Revenue Service (SARS) can appoint any company to act as an agent to collect outstanding taxes and administrative penalties owed to it by taxpayers. This is in terms of Section 99 of the Income Tax Act, No. 58 of 1962.
Now, SARS has begun using this law to issue such instructions to investment and life companies. This means companies managing your financial investments as well as life insurers are now required by law to collect any money owed to SARS in outstanding taxes, if requested to do so.
Investment and life companies have set up their systems to automatically process these instructions once received from SARS. As such, these amounts can be legally deducted from clients’ investment or insurance payouts, such as living annuity incomes, and paid directly to SARS.
Unfortunately, prior notice of these deductions is not given, and clients are only notified once the money has already been deducted, with ‘SARS AA88’ being provided as the payment reference on the statement.
These deductions cannot be influenced in any way, either by us as our clients’ brokers or the investment or life companies where their investments and policies are held. All queries in this regard must be directed to SARS.
If you are uncertain as to whether or not you have any outstanding taxes or penalties due to SARS, we recommend querying this telephonically with SARS, via eFiling or through your tax consultant.
Octagon Financial
Share Article
Latest News
Events that moved the market Q1 2021
Apr 13, 2021
Read this article on the Graviton Perspectives website. Click here.
March 2021 economic review
Apr 9, 2021
Read this article on the Graviton Perspectives website. Click here.
Asset Manager Report │How SA managers are positioned post-Budget 2021
Apr 6, 2021
Read this article on the Graviton Perspectives website. Click here.
Rebuilding after the storm: a webinar with Ninety One’s Jeremey Gardiner
Mar 18, 2021
Octagon Financial and Graviton invite you to join Menachem Kay and Ninety One’s Jeremy Gardiner as…
Regulation 28 amendments
Mar 12, 2021
Read this article on the Graviton Perspectives website. Click here.
February 2021 economic review
Mar 10, 2021
Read this article on the Graviton Perspectives website. Click here.
The country’s finances remain in the balance
Mar 9, 2021
February topped off another month of positive returns following January’s strong start to the year.…
Budget 2021: key points for investors
Mar 2, 2021
Read this article on the Graviton Perspectives website. Click here.
Industry report: Fund manager changes Q4 2020
Mar 1, 2021
Read this article on the Graviton Perspectives website. Click here.
The right intent and strategy, but it’s a battle to stabilise debt
Feb 25, 2021
Read this article on the Graviton Perspectives website. Click here.