Where do I report possible PAYE fraud?
Important:
This answer is based on tax law for the tax year ending 28 February 2017.
Answer:
Each individual has an obligation to submit a return and declare the income therein. The problem here is that SARS won't provide the taxpayers, the employees, with a populated return nor process the return until the IRP5 tax certificate information from the employer is received. According to information on the SARS website, “SARS won't penalise the taxpayer for the non-compliance by an employer.” If the employee declares the income, the employees tax withheld will not be available as a credit. You may want to contact SARS in this regard as we understand they have changed their view in this respect, but we haven’t officially received the details from them. If the employees have payslips to prove the employees tax that was withheld, it may be accepted by SARS.
The employer, as withholding agent (see section 157 of the Tax Administration Act) is personally liable for an amount of tax withheld and not paid to SARS. This again will require the parties to approach SARS.