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What would happen if I don’t file my tax return on time ?

You will be charged Administrative Penalty (Admin Penalty) by SARS. This is a penalty levied under Section 210 of the Tax Administration Act (TAA). 

The Act prescribes the various types of non-compliance which are subject to fixed administrative penalties.

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Currently the penalty is imposed only for non-submissions of tax returns in respect of individuals and companies:

For individuals the penalty will be imposed where the taxpayer has failed to submit a return as and when required under the Income Tax Act for years of assessment commencing on or after 1 March 2006 where that person has two or more outstanding income tax returns for such years of assessment; and

For companies the penalty will be imposed where the company has failed to submit an income tax return as and when required under the Income Tax Act for years of assessment ending during the 2009 and subsequent calendar years, where SARS has issued that company with a final demand referring to the public notice and requiring the submission of the outstanding income tax return, and the company failed to submit the return within 21 business days of the date of issue of the final demand.

Taxpayers who do not submit their tax returns will be charged an admin penalty which must be paid over to SARS.

Top Tip: Regardless of whether you agree or disagree with the admin penalty it is advisable to submit the outstanding return to stop further admin penalties. The penalty will reoccur for every month the return(s) remains outstanding for a maximum of 35 months. 

The administrative non-compliance penalty for the failure to submit a return comprises fixed amount penalties based on a taxpayer’s taxable income and can range from R250 up to R16 000 a month for each month that the non-compliance continues.

Administrative penalties recur each month that the taxpayer is non-compliant, up to a maximum of 35 months. Each recurring penalty will have a unique transaction number.

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