SARS red tape is killing business

[CLIVE-TRIANGLE]

It is understandable when looking at it from your point of view but what about theirs? The red tape might possibly be the best way to sort through legitimate and illegitimate people. Besides, policy is policy, as my boss usually says!

Except for a number of issues that you must bear in mind:
1. Separate red tape from plain incompetence
2. As pointed out, registrants are not competitive when they have to include that VAT in their cost, and thus lose huge business.
3. The Act makes registration compulsory when R1m is exceeded; from that point onwards the registrant is non-compliant and that bridge will still have to be crossed!
4. The registrant indicates from which date he is liable; if it takes that many months to finalise the registration, he has already incurred significant penalties.
5. This is the worst; how much money does the fiscus actually lose in respect of VAT that they would have received, were it not for the delay.

I'm sure there are more.

The old story of fraudulent applications just does not wash. Not at all. These days refunds are rigorously audited before they are paid out. That there is fraud in their own midst is an absolute given, but that is no reason to make registration a bridge too far.

As for policy, my old boss used to say "policy se moer".

[Marq]

As part of the trade-off, there'll be no VAT refunds......

What trade off are you talking about?
They will make the application process much easier in return for not paying out legitimate claims? No trade off there.

So if you are not profitable, you are also penalised by SARS from a cashflow point of view.....thats assuming you will become profitable.

I always try and maintain a positive vat payment scenario to avoid any issues with the. At the beginning of the year had a situation that reduced the total payment to only R79. A bit down from my 'usual' payment. They invoked paragraph 6010 rule 3g of clause 6b subset c quad i) of some foreign tax law, which says...this guy is suspect having only paying us a small amount, how dare his business not make bucks like it usually does - therefore he is penalised and shall endure the wrath of many audits and questions and papers and phone calls to please explain this situation. And so it was that an extra months administration was involved with many high salaried individuals to explain why the R79 should not be R179.
So eventually I gave up and agreed to pay an extra R100 ( I kid you not it was about that) for having claimed an amount on an invoice which they felt was not in the production of income.

Through efiling, I followed their instructions on the phone on how to correct this situation. It seems afterwards that I did the adjustment in the wrong period - to fix the fix (with on the phone instruction and much frustration) has been a comedy of errors, along with penalties and interest for not having paid the full amount in the one period and letters of warnings for having overpaid in the next. I am still trying to correct this allocation problem. Seems as though I am incapable of following instruction and should be punished by the state.

Another scenario......I follow the efiling system which says:-

- fill in vat form, push the submit button which induces the payment form to popup which creates bucks out your bank. Simple right.....
Last year one of the periods did not happen properly because apparently per their expert on the phone, I pushed the manual submit button instead of the file your return button. This has created a situation of an unallocated payment and a return that still needs to be submitted.
So I asked - If one pushes the manual button, does the payment scenario happen automatically.
'No this cannot happen as the system would not know how much you must pay' - 'Ok' says I - 'then how did the automatic system take my bucks for the exact amount that the form said I must pay?"
They dont know - but what they do know is that I must write a letter - post office style, no email or efiling method - to their committee of ten to apologise for the error of my ways in not pushing the right button and creating all these problems and they will in turn look at and review the whole sorry state of affairs and perhaps reverse the penalties for not having submitted that months return.
I advocated that they had a payment and that it had not mattered whether the form had been manually submitted or which ever button had been pushed - the form had been saved on their system and seeing as everything was done by using their system they should be able to review their log and audit files and determine that a form had in fact been filed. Another ongoing outstanding problem created through efiling.

So lets talk about 'common sense' here....I dont think so - common sense = a basic knowledge of logic and simple mind activity.
Not likely to happen when it comes to sars. According to my records, I am up to date and have accounted to them for all. According to them, I am not up to date, have many outstanding issues and owe penalties and interest for having used their system correctly.

I sit here and think.. I am an accountant, I know this stuff, I know forms. I build websites and databases as well and yet somehow I have failed dismally to use what should be the easiest of all website systems to use. What is wrong with me? Then I realise....I am using the force of mind and logic to understand government and potential sycophantic drones, I should be using ....??.....gee I dont know what force one uses against such a thing.....dark magic comes to mind. Perhaps a course at Hogwarts will sort this out.

[wynn]

I am using the force of mind and logic to understand government and potential sycophantic drones, I should be using ....??.....gee I dont know what force one uses against such a thing.....dark magic comes to mind. Perhaps a course at Hogwarts will sort this out.

You call them 'Swivel Servants' because they sit on swivel chairs, and they run efficiently on KFC.
No KFC and they develop that 'Civil Servant Shuffle' you know the one where they heave a huge sigh and sort of waddle over the area from cabinet to printer as if they are walking barefoot of broken glass.

Supply KFC and you will get the finest service available.

[Marq]

KFC = Komrades Fuel Cell - right ... sort of gives you wings.

[AndyD]

... sort of gives you wings.

Bingo wings.....

[Miro Bagrov]

I understand your frustration.

Red tape is killing business every where in SA. Red tape and bribery have the same effect in the end.
They are both just a deadweight loss to society and a raise in costs.


(source: http://venitism.blogspot.com/2013/04...orruption.html)

I remember in my time of having a distribution business, that only one of our clients told us that they wanted us to have a VAT number to be able do business with them.
I replied,
"No problem, I will register a special 'vat-vendor-company' just for you! Just as long as you don't mind paying 14% more than everyone else is prepared to."

My moral: Where there is rent seeking expect higher prices.

[Marq]

common sense

This about sums it up

[Houses4Rent]

Tax ombud ready to resolve complaints

If early indications are anything to go by, South Africa’s new tax ombudsman is going to have his hands full.

Although only officially launched by finance minister Pravin Gordhan last month, the office of the South African tax ombud has been at work since October last year. It has since been approached by more than 670 taxpayers for assistance.

“This includes not only complaints, but also questions about the process of lodging a complaint and other related uncertainties,” explains tax ombud chief executive Eric Mkhawane.

At the helm of the ombud’s office is retired judge Bernard Ngoepe who, along with a team of experts, is dealing with legitimate complaints by taxpayers.

This includes any grievances relating to administrative issues, poor service and procedural matters that cannot be resolved through the South African Revenue Service’s (Sars) usual internal mechanisms.

The ombud’s office also facilitates access to a complaint resolution process and guides taxpayers according to the process that needs to be followed.

The tax ombud may, however, not address any legislative or policy issues.

Says Mkhawane: “We cannot get involved in matters before court. Of the 673 queries we received, 61 fell within our mandate and we were able to finalise 70% of them. The remaining complaints are still within our turnaround time-frame and we are in the process of finalising them.”

He says the ombud’s office aims to deal with a complaint within 15 days upon receiving the necessary supporting documentation.

“There are however situations where this period is not sufficient, but we will inform the taxpayers when this is the case and provide them with regular feedback about the process,” says Mkhwanane.

To date, taxpayers who have made use of the ombud’s services include individual taxpayers as well as business owners. The complaints cover a wide range of issues from not having received tax refunds to the correct Sars processes not having been followed.

Spokeswoman for the National Treasury, Phumza Macanda, says taxpayers can lodge a complaint with the tax ombud once they have followed Sars’s complaint procedures, which includes first contacting Sars directly through a branch or through the Sars contact centre.

“If the desired outcome is not reached, the matter should then be escalated to the Sars Service Monitoring Office,” says Macanda.

However, Mkhwanane says there are some cases with compelling circumstances that allow taxpayers to contact the ombud’s office directly before going through these processes.

“This will only be in case of an emergency when time is of the essence and going through the internal process first could negatively impact the taxpayer,” he points out.

The first step to lodging a complaint is to supply the tax ombud’s office with the necessary supporting documents.

Those business owners interested in lodging a complaint with the ombud need to fill in a complaint form, which can either be found on the tax ombud’s website, or which can be faxed or sent via email on request.

As well as the necessary supporting documentation, complainants must also provide their contact details and information on the complaint.
Mkhawane believes that now that the tax ombud has officially been launched, the number of complaints will increase.

“Recently Judge Ngoepe was interviewed on a radio and soon afterwards, we saw a spike in complaints.

The more people know about the service, the more they will make use of it,” says Mkhawane.

Go to www.taxombud.gov.za or call 080 066 2837 to lodge a complaint with the tax ombud or email ssmo@sars.gov.za to reach the Sars Service Monitoring Office.

Bernard Ngoepe, Eric Mkhawane, news, Phumza Macanda, Pravin Gordhan, Small Business Connect, The DTI