DELAYED refunds on Value-Added Tax (VAT) have increased significantly, causing cash flow problems for especially small and medium-sized enterprises.
This is according to tax practitioners interviewed this week, who said it was also increasing the cost of doing business as businesses need to pay professionals to get back what had been rightfully theirs in the first place.
Victor Terblanche, chairman of the South African Institute of Tax Professionals’ (SAIT’s) VAT committee, said the VAT Act did not provide for a timeframe for the payment of VAT refunds, or a timeframe for the finalisation of audits.
"The act does provide for the payment of interest if the refund is not paid within 21 days following the submission of the VAT return," said Mr Terblanche.
"The act is quite clear. It does not say that SARS has a discretion to pay interest. The act says interest shall be paid at the prescribed rate."
This is according to tax practitioners interviewed this week, who said it was also increasing the cost of doing business as businesses need to pay professionals to get back what had been rightfully theirs in the first place.
Victor Terblanche, chairman of the South African Institute of Tax Professionals’ (SAIT’s) VAT committee, said the VAT Act did not provide for a timeframe for the payment of VAT refunds, or a timeframe for the finalisation of audits.
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| SINGLE FILE: People queue in Polokwane to file their income tax returns by the deadline. |
"The act does provide for the payment of interest if the refund is not paid within 21 days following the submission of the VAT return," said Mr Terblanche.
"The act is quite clear. It does not say that SARS has a discretion to pay interest. The act says interest shall be paid at the prescribed rate."
