SARS is saying “no” to some taxpayers trying to leave South Africa

South African taxpayers require a letter of confirmation for non-residents to stop paying their taxes when they leave the country permanently, but what if they decline your request? This is becoming an increasingly common problem, says specialist consulting firm Tax Consulting SA.

“The non-resident confirmation letter is where the South African Revenue Service (SARS) formally confirms that you are not a resident for tax purposes. They run a system and check to make sure they give up their tax rights around the world, as this isn’t something any tax authority wants to see, ”the company said.

“We are increasingly approached by taxpayers, or their advisors, where a confirmation letter from non-residents has been rejected. To date, we have not seen a SARS rejection for this letter which was issued incorrectly.

Tax Consulting SA noted that the reasons for this refusal are normally due to the fact that the process originally followed to break the tax residency with SARS was flawed or, in many cases, no formal process was followed.

The process

It is worth noting that, in order to apply for the confirmation letter, you must have already completed emigration (cessation of tax residency) through the formal SARS process, Tax Consulting SA said.

“Just like any other legal application, this process has specific requirements and, typical of SARS, must undoubtedly be met in order for the letter to be granted. Keeping in mind that issuing the non-resident confirmation letter involves a verification of their status of South African tax residence, SARS requires various supporting documents for this application to be successful.

“This is where you will know if your tax advisor has followed the correct procedures to resolve your international tax issues. Some consultants issue lengthy opinions on tax residency, while others do what is best called a “soft emigration” with SARS where they don’t go through the proper process. These approaches by tax advisors, although on opposite sides of the spectrum, have one thing in common: where the correct process is not followed, the SARS confirmation letter will not be issued. “

Application rejected

Tax Consulting SA noted that the application can be rejected after SARS has conducted stringent compliance checks and extensive verification of the evidence provided.

A rejection is usually based on a lack of documents and information submitted to SARS to support the claim, or if one has not yet formally ceased their tax residency, he said.

“Only after meeting the established requirements will the application be successful. The onus is always on you, taxpayer, to prove your facts about SARS without a doubt. “

“This is not an easy process; it is an intensive and lengthy administration. It is always advisable to seek professional advice and competent assistance when dealing with SARS-related matters. “


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