As South African Revenue Service (Sars) phases in the new customs legislation, industry has been advised to keep abreast of changes and amendments.Addressing exporters in Cape Town recently, partner at Shepstone & Wylie, Freek van Rooyen, drew attention to the changes made late last year to the dispute resolution process as well as amendments to the application for suspension of payments.“It is that time of year when we see lots of letters of intent being issued by Sars followed by letters of demand,” he said. “What now? Do you pay or do you f ight?”He said considering that from the minute a demand was received there was a debt to the state that Sars could execute, being aware of changes to the dispute resolution process and amendments to the suspension of payments was critical.“If you receive a letter of demand regarding a potential contravention of the customs act, that letter constitutes a decision,” said Van Rooyen, indicating that should the revenue service wish to, it had the right to appoint a bank as its agent and lay claim to the amount owed to it in the business bank account.“You could arrive at work and not have a single cent in your account,” he warned.Receivers of demand letters do have the right to request reasons from Sars if they believe that the original document received does not specifically state what the alleged wrongs were or they can immediately deliver a notice of administrative appeal.“But the delivery of that appeal does not in itself stop Sars from collecting or enforcing whatever amounts might be due in terms of the letter of demand.”He said it was therefore important that a request for the suspension of payment was made immediately on receiving a letter of demand. “In the past the Tax Administration Act was very specific about the requirements, but it did not apply to the Customs Act. In September last year the Customs Act was amended to deal with the suspension of payment applications.”Van Rooyen said very specific time periods were available for appeals and they had to be adhered to strictly, while a range of documents including bank statements and the company’s compliance history had to be submitted.Applications for payment suspensions must also be made when appealing a demand decision.“If your attempt at fighting the demand is unsuccessful and you are going to appeal the decision, then again file an application for the suspension of payment immediately,” said Van Rooyen.This was considered a safer option to paying and reclaiming once an appeal is won.“At present refunds have to be made within a two-year period, while a court appeal process could take longer, with the result that you are entitled to claim your refund anymore.”
INSERT: Sars has the right to appoint a bank as its agent and lay claim to the amount owed to it in the business bank account.– Freek van Rooyen
