The timing conundrum of the suspension of payment request

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The timing conundrum of the suspension of payment request

• 10 September 2025
• Tax Administration
• Adv Christel van Wyk

The pay-now-argue-later principle is firmly entrenched in South African tax law by virtue of section 164(1) of the Tax Administration Act, 28 of 2011 (the Act). This provision establishes that, unless a senior SARS official directs otherwise, the obligation to pay tax and SARS’s right to recover it will not be suspended by an objection, appeal, or pending decision of a court under section 133 of the Act.

No Automatic Suspension

Payment of a disputed tax debt is not automatically suspended. A taxpayer who wishes to contest an assessment must submit a formal request for suspension of payment. However, the Act does not clearly address the timing of such a request, creating practical difficulties and legal uncertainty.

Practical Example

Consider the following scenario:

• SARS issues an additional assessment on 17 June 2025, specifying that the tax debt must be paid by 31 July 2025.
• The taxpayer may lodge an objection within 80 business days from the assessment date, which means by 8 October 2025.
• The taxpayer begins preparing the objection, but on 14 August 2025 (ten business days after the payment deadline), SARS issues a demand requiring payment by 28 August 2025.

To prevent enforcement measures—such as third-party appointments—the taxpayer must submit a suspension of payment request before 28 August 2025.

Assume the taxpayer submits the suspension request on 15 August 2025. At this stage, the objection is still being prepared, meaning the taxpayer must address the strength of the merits without having fully developed the grounds of objection. This creates inherent difficulties.

SARS’s Response Timeline

According to its Service Charter, SARS must respond to a suspension request within 30 business days. In this example, that means SARS should provide an outcome by 29 September 2025.

During this period, the taxpayer remains in a legally uncertain position. If SARS declines the request, the taxpayer has no recourse and must settle the debt.

Further Challenges

Several additional issues complicate the process:

• Lack of transparency: SARS’s decision is made through a committee process with no visibility for the taxpayer, except via a formal access-to-information request.
• Unclear factors: The weighting or relevance of factors SARS considers is not explained, leaving taxpayers in the dark about the basis for decisions.
• Repeat requests: If a suspension request is declined, it is unclear whether a new request can be validly submitted. Even if permitted, it must be made within ten business days, as SARS can resume enforcement steps within that period. This raises the legal question of whether SARS is functus officio—barred from reconsidering the matter.

Should the Process Be Revisited?

In an era where agility, transparency, legal certainty, and rationality are key, the current suspension-of-payment process seems unnecessarily cumbersome. This raises important questions:

• Should the process be streamlined to reduce the administrative burden on both SARS and taxpayers?
• Should the Act explicitly specify the timing of a suspension request?
• Should SARS provide clearer guidance on the relevance and weighting of the factors it considers?
• Should taxpayers have the right to object to SARS’s refusal to suspend payment, or should suspension decisions be linked to a request for a reduced assessment?

Closing Thought

Given the significant consequences of a refusal to suspend payment, it is worth asking whether the suspension process should be modernised. Addressing its timing, transparency, and practical challenges could go a long way toward creating a more efficient, equitable, and legally certain system for both SARS and taxpayers.

This article explores the pay-now-argue-later rule, the challenges of suspension requests, and the need for a clearer, more transparent process. For members who wish to learn more about this topic, you can watch the full webinar recording here.

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