What the Law Says
Under Sections 167 and 168 of the Tax Administration Act 28 of 2011 (TAA), SARS may permit taxpayers to settle tax debt in instalments (a “payment arrangement”) instead of a once-off payment. Approval is discretionary and depends on full disclosure and supporting evidence of your financial position.
Why Choose a Payment Arrangement?
- Reduce immediate cash strain by spreading payments over time.
- Stay compliant while avoiding harsher collection measures.
- Protect business continuity while you stabilise cash flow.
Note: A payment arrangement does not include write-offs, but it gives you time and flexibility to manage the debt effectively.
Documents SARS Typically Requires
Submitting a complete, consistent pack improves approval odds. We help you compile:
- Bank statements (last 3 months)
- 12 months future Cash flow statement / 12-months Cashforecast
- Financial statements (last 3 years, if applicable)
- Up-to-date management accounts
- Asset register (with disposals over the last 3 years)
- Detailed debtors and creditors analyses
Understanding SARS Debt Escalation
When a taxpayer has an outstanding tax amount, SARS debt management initiates the engagement by issuing a formal final letter of demand. This document confirms the outstanding amount and specifies a strict deadline of 10 business days for payment. Non-compliance will lead to significant consequences, including:
- Immediate deductions from the taxpayer’s bank account.
- SARS appointing third parties (e.g., banks or customers) to recover funds directly.
- Civil judgments and execution against assets.
Be proactive, not reactive. Engage us early to shape a practical solution.
What If You Default on a Payment Arrangement?
Defaulting can be more costly than not applying:
- Immediate cancellation of the arrangement.
- Full balance due at once and loss of goodwill with SARS.
- Fast-tracked enforcement: third-party appointments, asset attachment, judgments.
- Stricter terms (or refusal) on future relief requests.
We design realistic schedules that you can maintain and we help monitor compliance.
How BONMAS CONSULTING Helps
Our Process
- Assessment: We review your position, risk, and cash capacity.
- Documentation: Compile financial statements, forecasts, and management accounts.
- Proposal: Build a feasible instalment plan aligned to your cash flow.
- Submission & Engagement: Lodge a submission with SARS and handle queries.
- Aftercare: Calendarised reminders and check-ins to avoid default.
FAQs: SARS Payment Arrangements
Who qualifies for a payment arrangement?
Taxpayers who disclose full financials and demonstrate inability to pay a lump sum but ability to honour a reasonable instalment plan.
How long can I pay over?
Depends on affordability and SARS’s risk assessment. We help model a duration that is both realistic and defensible.
Can I include penalties and interest?
Payment arrangements typically cover the full debt outstanding (tax, penalties, interest). Separate relief (e.g., remission) may be explored case-by-case.
Can I withdraw my request after submitting?
No — SARS does not allow cancellation after submission, so preparation is critical.
What if SARS already issued a letter of demand?
Act immediately. We can still propose terms and mitigate imminent enforcement, but time is crucial.
Ready to Regain Control?
Approach SARS correctly and legally with BONMAS CONSULTING by your side. A sound plan today prevents costly enforcement tomorrow.
