Sars charges penalties and interest when payments are made late or returns are not submitted in time.

When a return is submitted late, a 10% penalty is charged immediately. Interest is then charged from the due date date of the return until the date the return is submitted on. This is also the case where a return is submitted, but the payment is not made by the due date.

Where tax returns are not submitted at all, SARS issues administrative non-compliance penalties that scale with the size of the taxpayer — roughly R250 to R16,000 per month depending on turnover — and the amount multiplies for every repeated month of non-submission (up to 10x).

In certain circumstances, SARS will remit the penalties. In order for this to be successfully processed, a valid reason must be provided to SARS.