Author: Sduduzo Mhlongo (ENSAfrica candidate attorney).
The South African Revenue Service (“SARS”) has introduced a new Tax Compliance Status System (“TCS”) from 18 April 2016 in an effort to improve compliance and to make it easier for taxpayers to manage their tax affairs. The Tax Compliance Status System is a holistic view of the tax compliance level across all registered tax types.
The new system makes it stress-free for taxpayers to obtain a Tax Clearance Certificate (“TCC”) and allows taxpayers to obtain a Tax Compliance Status PIN which can be used by authorised third parties to verify the taxpayer’s compliance status online via SARS eFiling. There are 2 steps in the process of obtaining a TCS:
Step 1: To activate “My Compliance Profile” on SARS eFiling:
1) Select the “Tax Status” tab from the main menu items at the top of the eFiling page.
2) Select “Activation” to activate the tax compliance status system.
3) The “Tax Compliance Status Service Activation” work page will be displayed and the tax reference number will be pre-populated on the screen.
4) Select the “Tax Compliance Status” check box. Read and accept the “disclaimer” check box and click the “activate” button to proceed with the activation.
5) Once you have activated the “My Compliance Profile” and you have selected all your registered tax reference numbers, you will be given access to your “My Compliance Profile”.
6) If you wish to deactivate the tax compliance status system on your eFiling profile, select the “Tax Compliance Status” tick box and click the “de-activate” button.
7) Taxpayers only need to activate the Tax Compliance Status once.
8) You can view your tax compliance profile by selecting the “My Compliance Profile” menu option. A colour-coded profile will appear to indicate whether you are tax compliant or not. Red will show if you are not tax compliant and green will show if you are tax compliant. If you are not satisfied or do not agree with your tax compliance status, you can motivate why SARS needs to re-evaluate your tax compliance status. This can be done on eFiling by clicking on “Challenge Status” and providing a motivation as to why SARS should re-evaluate your tax compliance status.
STEP 2: To request your Tax Compliance Status via eFiling:
Once you have accessed your “My Compliance Profile”, you may request your Tax Compliance Status by:
1) Selecting the “Tax Compliance Status Request” option and the type of Tax Compliance Status for which you would like to apply for. You will have the following options:
- Good standing
- Foreign Investment Allowance (FIA) (individuals only)
- Emigration (individuals only)
2) Complete the Tax Compliance Status Request and submit it to SARS. Supporting documents must be attached in respect of FIA and Emigration.
3) Once your request is approved by SARS, you will be issued with an overall Tax Compliance Status and a PIN. The PIN provides you with a way to authorise any third party to view your tax compliance status online via eFiling. You can request that the PIN be sent to you via SMS and you can view it on your “Tax Compliance Status Request” dashboard on your eFiling profile. A unique PIN will be issued for each request that you make.
4) Please note that once you have provided the PIN to a third party, the PIN will enable the relevant third party to view your current tax compliance status online.
It will present them with your overall compliance status as at the date and time they check it instead of your status as it was at the date that the PIN was issued to you. To protect the confidentiality of taxpayer information, no other information will be accessible.
5) In addition to the PIN, you will also be able to print a TCC, in the existing format by selecting “Print TCC”. The “Print TCC” function will only be available if your overall tax compliance status reflects as compliant.
6) Please note that not all government institutions and private organisations will be able to utilse the Tax Compliance Status PIN at this stage and in such instances, you must supply a printed TCC. It is envisaged that the PIN will, in time, replace the paper TCC.
Please contact us if you require any assistance activating your “My Compliance Status” or requesting for your Tax Compliance Status.
Sdudzo Mhlongo is a candidate attorney at the tax department at ENSafrica.
Reviewed by Arnaaz Carmay, executive at ENSafrica’s tax department.