SARS tax debt compromise
SARS has employed new debt collectors who is currently busy with revenue collection. This means that all taxpayers, whether it is for individual or company taxes, are receiving letters of demand for outstanding tax. They are also making use of legal action to collect the money. This can include civil judgements as well as execution instructions from the sheriff. It is therefore important to take action if you owe SARS money.
What is a debt compromise?
A debt compromise is an action where SARS writes off a part of your debt. For example, if you owe R100 000, and you can demonstrate that you only have the means to pay R80 000, the R20 000 will be written off. This will only take affect if you keep to your agreement of repaying the outstanding balance.
Who can apply?
All individuals or businesses who owe tax debt that is older than 12 months can apply. To ensure a successful application, the following documents have to be included:
- 6 Month’s bank statements
- A list of assets and liabilites
- a cash flow forecast for 12 months
- A list of income and expenses
- Financial statements not older than a year for businesses.
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