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VAT Estimated Assessments
- 17 September 2024
- Tax Administration
- Marita Jordaan
This article is based on tax law for the year ending 28 February 2025.
1. The Facts
SARS is currently issuing estimated assessments after conducting reviews or audits on income tax and VAT. These assessments pose a challenge, as objections cannot be filed against estimated assessments.
2. The Problem
Is there an alternative approach to handling these assessments?
3. Applicable Law
TAA 28 of 2011 section 95
4. Application of the Law to the Facts
Estimated assessments, generally issued when the taxpayer has failed to submit the required supporting documentation requested by SARS.
The initial assumption is that the estimated assessment was properly issued under section 95(2), due to the taxpayer’s non-compliance with section 95(1)(b) by not providing the requested evidence. The taxpayer then has 40 business days to submit the outstanding documentation through the SARS SOQS portal. If the 40 business days have passed, an extension request must be submitted. If within 70 days, reasons must be provided, and if beyond 70 days, exceptional circumstances must be demonstrated. Various processes exist to challenge SARS’s decisions, including a section 9 review if SARS refuses to revise the assessment. If this process is unsuccessful, the matter can be taken to the tax court. A Notice of Objection (NOO) can only be filed after SARS has considered the evidence and issued a final assessment.