Tax non-compliance targeted in law enforcement initiative

Joint operation targeting businesses and company directors suspected of contravening provisions of the Tax Administration Act

5 hours ago

Conelia Harry 2 minutes read

Section commander of the KZN Provincial Commercial Crime Unit in Richards Bay, Lieutenant Colonel VC Pillay

Several arrests have been made as law enforcement intensifies its crackdown on tax non-compliance through the Project Honey Badger rollout in Richards Bay.

The joint initiative involving the South African Revenue Service (Sars), National Prosecuting Authority (NPA) and Directorate for Priority Crime Investigation (Hawks) is targeting businesses and company directors suspected of contravening provisions of the Tax Administration Act.

The latest arrests come as authorities step up investigations into tax-related offences, including the failure to submit returns and the non-payment of taxes such as Company Tax, Personal Income Tax, Value Added Tax (VAT) and Pay As You Earn (PAYE).

Section commander of the KZN Provincial Commercial Crime Unit based in Richards Bay, Lieutenant Colonel VC Pillay, has warned businesses and directors not to ignore their tax obligations.

“These arrests are a warning to businesses and directors that tax compliance is not optional and that authorities are prepared to take enforcement action against those who fail to meet their statutory obligations,” said Pillay.

Businesses are urged to review their Sars status, submit outstanding returns, settle outstanding amounts or engage Sars about payment arrangements where applicable, and ensure their records are up to date.

“Businesses are also urged to ensure their Sars contact details and addresses are updated, particularly when there has been a change of accountant or bookkeeper,” said Pillay.

“Sars communicates with taxpayers using their last known contact details. Failing to receive correspondence does not remove the taxpayer’s responsibility to comply.

“Taxpayers identified as non-compliant may initially be contacted by Sars and given an opportunity to address outstanding obligations. Failing these avenues and attempts, letters of demand and further engagement may follow.

“We encourage businesses that receive correspondence from Sars to engage with the revenue service rather than ignore notices or demands.

“By engaging and rectifying the contraventions, fines can be avoided. Our unit has received a number of these cases, and we want the community to check their company status with Sars,” he urged.

Pillay stressed that is is the responsibility of company directors to ensure their businesses remain compliant, even when accounting and bookkeeping services are outsourced.

In some instances, Pillay said, authorities have encountered cases where directors attempt to shift responsibility to accountants after tax obligations have not been met.

However, he stressed the onus relies on the directors to ensure compliance.

In addition, there have been several cases where concerns were raised about employers deducting money from employees but failing to pay it over as required for PAYE obligations.

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