Wellington Small Business Services

05/02/2026

Is your accounting system and internal processes ready for near REAL- time VAT? see letter from SAIT below

“REAL-TIME VAT DATA AND E-INVOICING: A NEW ERA OF VISIBILITY FOR TAX COMPLIANCE IN SOUTH AFRICA

26 January 2026 | Tax | Tax | South African Institute of Taxation (SAIT)
At recent engagements, the South African Revenue Service has shed further light on its long-anticipated e-invoicing framework, first referenced in the 2023 draft proposals, with the full framework expected to be released early this year.

This marks a significant step in SARS’ broader modernisation agenda, which is rapidly shifting South Africa’s tax environment toward real-time data transmission, automation and increased transparency. The phased rollout is expected to begin in 2026, with full operational capability targeted for 2028.

As the South African Institute of Taxation (SAIT), we have reviewed SARS’ draft e-invoicing and VAT modernisation framework and submitted formal comments to SARS (in 2023) as part of our role in shaping an effective, balanced and future-oriented tax ecosystem. Our Acting Deputy Chief Executive Officer of SAIT, Keitumetse Sesana confirms that Modernisation 3.0 represents a pivotal shift for South Africa’s tax ecosystem. It introduces the potential for a more predictable, efficient compliance environment, but also places significant responsibility on businesses to ensure systems, data and processes are prepared for this new level of transparency.

South Africa now stands on the threshold of a system-driven compliance era; one in which SARS gains earlier, richer and more accurate visibility of business activity, long before VAT returns are formally submitted.

The upcoming e-invoicing regime promises a more streamlined, less administratively burdensome experience for taxpayers whose systems are aligned with SARS’ new requirements, moving South Africa towards Modernisation 3.0. Digitally structured invoices, validated VAT numbers, and automated data flows will allow VAT information to be transmitted directly from accounting systems into SARS in near real time.

For many businesses, this means fewer documentation requests, faster verification cycles and improved refund turnaround times. Compliance will naturally embed itself into daily operations, rather than remaining an isolated monthly task.

The same digital capabilities that create seamless compliance also give SARS unprecedented insight into the operations of vendors. Real-time data from banks, accounting systems and third-party platforms will increasingly allow SARS to detect discrepancies — often before a taxpayer becomes aware of them.

Filing low or zero VAT returns while bank activity reflects trading will trigger automated risk flags. Mismatches between invoicing patterns and VAT declarations will be surfaced immediately. Understatement penalties have become stricter, and the margin for “honest mistake” classifications has narrowed significantly.

In this environment, compliance becomes a systems issue first — and a tax issue second.

Accuracy at the point of data creation will define the new compliance landscape. Every invoice, credit note and adjustment entered into financial systems must be correct from the outset. VAT numbers must be validated in real-time. Controls against duplication, incorrect sequencing and inconsistent tax treatment must be embedded within accounting platforms.

SARS’ risk engines will increasingly analyse behavioural patterns and detect gaps as they occur. Tax Compliance Status (TCS) will become a near-instant indicator of reliability, affecting access to tenders, supply chains and financing. This will be an immediate step in curbing amongst others the prevalence of VAT refund fraud.

As the visibility of transactional data increases, the cost of weak internal controls rises exponentially.

SAIT recognises that the move toward continuous data transmission and automated compliance is both an opportunity and a challenge. We remain fully available to engage with taxpayers, industry bodies and policymakers to unpack how this modernised ecosystem will unfold, what it will mean for day-to-day compliance, and how businesses and taxpayers can prepare for increased visibility in South Africa’s evolving tax landscape. South Africa is entering a tax environment where SARS sees operations as they unfold — not weeks or months later. This fast-paced visibility will expose inconsistencies and highlight risks with unprecedented speed.”

06/07/2025

Be on the lookout for SARS Auto Assessments, do NOT ignore them, else you may face huge penalties or even loose out on allowable deductions:

SARS has sent you an Income Tax Assessment for the 2025 tax year to help you easily fulfil your tax obligations. Your assessment is automatically calculated using information received from third parties, such as your employer, financial institutions, medical scheme, and retirement annuity fund administrators.

What you need to do

1. View your assessment: log in to SARS eFiling (sarsefiling.co.za) or the SARS MobiApp to check your Assessment.
2. If your assessment is correct: you do not need to submit a tax return.

3. If your assessment is incorrect:
You can submit your 2025 Income Tax Return on or before 20 October 2025.
You can submit your return on SARS eFiling (sarsefiling.co.za) or the SARS MobiApp.
For help with your return, go to the Filing Season webpage on sars.gov.za.
4. If a refund is due to you:
Refunds of R100 or more will be paid automatically within 72 hours.
Refunds of less than R100 will be added to your account and paid out when your account balance exceeds R100.
5. If your assessment shows that you owe SARS:
Debt of R100 or more must be paid by the due date to avoid interest charges. For payment options, go to the How do I pay webpage on sars.gov.za.
Debt of less than R100 will be carried over to the next tax year.
Need Help?

For further assistance, please use any of our channels:
SARS Website: visit the Filing Season webpage on sars.gov.za.
SARS Online Query System (SOQS): click on the SARS Online Query System (SOQS) tile on sars.gov.za.
SARS WhatsApp: send "Hi" or "Hello" to 0800 117 277.
AI Virtual Assistant: available 24/7 on the SARS website to answer your queries.
Dial *134*7277 #: to access SARS services.
No need to visit a SARS branch. If you must, first book an appointment to avoid long queues.

Sincerely
THE SOUTH AFRICAN REVENUE SERVICE

Visit the national COVID-19 Online Resource and News Portal at www.sacoronavirus.co.za or see SARS COVID-19 news items and tax relief measures here. Individuals Businesses and Employers Tax Practitioners Customs and Excise What’s my tax number? Tax Season Tax Compliance Status Request Book an appo...

23/10/2024

Duties of a director
Why is this important at all?
Because “they” will come for your house, your car and your bank balance!
Who is they? SARS for one, CIPC is another..

WHY?
Unless you can prove, beyond a shadow of a doubt that you have done your fiduciary duty, you are guilty. (You will still need a lawyer to prove it)

HOW do you prevent this?
By knowing your duties and actively pursuing them. Here are six tips:

Face up to uncomfortable truths
What are the attitudes or assumptions that are taken for granted by your board? Is there a willingness to discuss them or test them with fresh evidence? Are key issues being ignored due to wishful thinking or because they would have uncomfortable implications?

Break out of the boardroom bubble
It failed to adequately test perspectives/ assumptions by engaging directly
with other key stakeholders, employees, customers, suppliers, competitors
Are you listening to a diversity of voices, both inside and outside of the organisation, including some that may make for uncomfortable listening?

Don’t ignore red flags
When red flags arise, are you demonstrating curiosity and persistence in understanding their causes and consequences – especially if they relate to critical points, they provide insight into financial, cultural or reputational issues that might significantly impact the enterprise. Simple question: when last dis YOU check if the bank recon is up to date on your accounting system (manual recons are a BIG RED flag). Ask for a debtors and creditors age analysis from your accounting system, it takes a minute to print. Ask for a stock valuation report from your accounting system.

Demand full access to all relevant information
The withholding of crucial reports and information from board oversight is a key governance failure. It is both your RIGHT and your RESPONSIBILITY to actively determine the kind
of information YIU need to receive from management. Is the flow of information being filtered (prepared manually) in a way which inhibits you from forming an informed and independent perspective?

Advisers advise, directors decide
Any advice, and that of other types of consultants and advisers, may be a crucial input into board decision-making, it should not be accepted without question. Directors should apply
their own independent strategic judgement and moral compass to any advice that they receive. Directors rather than advisers are legally responsible for the organisation, and they are better placed to take a holistic view. As a director, are you satisfied that you are using advisers appropriately – as
a useful source of insight rather than as the ultimate arbiter of decision-making? Remember the buck stops with YOU alone in the courtroom

Insist on IT literacy
You do not need to be an IT expert. You simply need to know what your system is really capable of (if used optimally) and what information it can give you. Then simply ASK and INSIST the info must be a IT system generated report. That way you have info at your fingertips 24/7/364, not (on Christmas)

CREDIT:
IoD Policy Paper
The Post Office Scandal – A failure of governance

03/10/2024

Special day when one gets a mail like this!

16/07/2024

Eye-watering taxes await those who withdraw funds under two-pot

The new marginal tax rate that will apply to the savings pot is significantly higher than the existing tax rate for early retirement fund withdrawals.
Source: Liesl Peyper Moneyweb

Using retirement funds before retirement, may be easier now, but it is still UNWISE.

Even when are battling financially, we need to remember that when you retire there is NO MONEY coming in.

It is a fact that people have around 12 jobs in a lifetime. Most end up in a career very far removed from where they started out or studies towards.

We need to re-engineer every 10
Years at least.

When a person can’t get a job, we simply have to re-group, re-think and start all over again. And that is OK!

Gone are the days of working for the same conpany for 45 years, getting a “golden watch” and living comfortably ever after. Accept it.

Take a hard look at your life… what CAN you do that others can’t or won’t? Forget the 3 figure hourly rate, start off small, work hard but clever. Don’t be shy to ask for advice or help.

It’s tough out there but you can do it in FAITH.

26/06/2024

Need your tax number?


Dial *134*7277
Free call from YOUR mobile phone.

If your number changed, you need to send an email to [email protected]
Or visit a branch with the following:

1. Proof of your residential address
2. Original ID card (or book)
3. Proof of your bank account (stamped bank statement from your mobile APP

26/06/2024

supportingdocuments

Virtual appointments supporting documents

Tax payer ID: certified
Tax practitioner ID certified
Your ID: certified
Co reg: certified
Cover letter detailing the case
SARS Case letter

BE PREPARED. BE PATIENT
ICE-in-your-veins

25/01/2024

A Daily Philosophy on Becoming Legendary
“Do not allow your fire to go out, spark by irreplaceable spark in the hopeless swamps of the not-quite, the not-yet, and the not at all. Do not let the hero in your soul perish in lonely frustration for the life you deserved and have never been able to reach. The world you desire can be won. It exists. It is real. It is possible. It is yours.” —Ayn Rand

11/10/2023

For those using Sage 50c, Pastel partner… the customer and supplier documents must be .enz files and not .eng. In days gone past, .eng files were Pastel originals and .enz were customised. So if you get a weird error about “csdocsi” don’t fret, simply open the enz format and save as .enz format. No need to reinstall sage at all. Same goes for subscript out of range errors when trying to view an invoice on-screen from the statement or detailed legder.

06/09/2023

Therefore registered traditional healers are now recognised as legal traditional health practitioners. (The Traditional Health Practitioners Act 22 of 2007).
What does this mean to an employer?
If an employee now gives an employer a medical certificate from a traditional healer, he has to be given paid sick leave. It also means, if the certificate justifies the employee’s absence from work, it is valid.
Which medical certificates are then valid?
Medical certificates that are valid must now be issued by anyone of the following professionals:
Medical practitioner (Doctor with MBChB degree) that is registered with the Health Professions Council of South Africa.
Dentist that is registered with the Health Professions Council of South Africa.
Psychologist with a Masters Degree in Research, Counselling or Clinical Psychology that is registered with the Health Professions Council of South Africa.
Traditional healer or health practitioner that is registered with the Traditional Health Practitioners Council of South Africa.
A medical certificate from an employee who has seen any of the above-mentioned ‘professionals’ has to be accepted by an employer. A medical certificate from any practitioner who is not registered as above, does not have to be accepted by an employer.
Up to now the following checklist has been used to see what should be included on a valid medical certificate – this should now include a traditional health practitioner:
Doctor’s (or traditional health practitioner’s) name, address and qualifications;
Patient’s (employee’s) name;
Employee number (if applicable – especially where the employer sent the employee to the doctor);
Date and time the patient was examined;
Whether the certificate is given based on the doctor’s (or traditional health practitioner’s) personal observations or just according to the patient’s say-so (which could still be based on suitable medical grounds);
Description of the illness in simple words, with the patient’s informed consent. If the patient does not agree, then the doctor (or traditional health practitioner) must simply say it is his opinion the patient is not fit for work (bear in mind that some ailments can be embarrassing);
How long the patient is booked off for;
If the patient is completely or only partially unable to do his duties;
The date the sick note was given;
A clear indication of the doctor (or traditional health practitioner) who issued the note. He must personally sign or initial the original and print his name next to it in capital letters;
The doctor (or traditional health practitioner) must delete words on pre-printed stationery that do not apply to the patient; and
The doctor (or traditional health practitioner) must give the patient a short factual report if he asks for one.

03/08/2023

The delinquent director: No tolerance for errant directors?

Errant company directors who fail to comply with their obligations set out in the Companies Act, 2008 (Companies Act), face the prospect of being declared “delinquent” under certain circumstances. As a director, the possibility of being declared delinquent under the Companies Act, and thus unable to serve as a director of any company (possibly for life), is a frightening prospect.

The following questions should be of concern:

What are the consequences of a director being declared delinquent?
Key Takeaways

Various stakeholders may apply to court for an order to declare a director delinquent.
Directors must be declared unconditionally delinquent for their lifetime if they served as a director while ineligible, disqualified, or in contravention of a probation order.
Directors must be declared delinquent for at least seven years if they:
grossly abused the position of a director
used their position or inside knowledge to gain a personal advantage or to knowingly or by gross negligence harm the company
acted with “gross negligence, willful misconduct or breach of trust in relation to the performance of the director’s functions…”
have been repeatedly subject to compliance notices
have more than twice been criminally convicted of an offence, or
were a director of a company (or similar entity) which was convicted of an offence or a similar penalty, and the court is satisfied that a declaration of delinquency is justified
The court may also order a probation order of delinquency if the requirements are met.
Alongside an order of delinquency, a court may also order remedial programmes, community service, and/ or payment of compensation.
What are the consequences of being declared delinquent?

The delinquency remedy exists to protect the public and stakeholders (shareholders, creditors, etc.) from directors whose conduct has shown them to be incapable of managing a company properly, or with integrity. Our courts have declared directors, who have failed to discharge their duties under the Companies Act, to be delinquent, and have granted leave to the companies involved to claim damages from such director for losses incurred as a result of such director’s conduct.

Delinquent directors cannot continue to serve as, and are disqualified from being, directors. It is therefore incumbent on South African directors to take cognisance of the impact of section 162 of the Companies Act (declaration of delinquent directors) and to take steps to ensure that they do not open themselves up to the possibility of being declared delinquent.

Any declaration of delinquency will subsist for the lifetime of the person declared delinquent on account of having consented to serve as a director whilst ineligible or disqualified under the Companies Act, or whilst under a probation order in terms of the Companies Act that person acted in a manner that contravened the probation order. If the director is delinquent for other reasons, the order will be made for a minimum of seven years. The period of seven years is the minimum length. However, the court may make the delinquency order effective for a longer period. In egregious cases, the order can cover a director’s entire lifetime. Any declaration made by the court may be made subject to any conditions that the court considers appropriate, including a limitation of the application of such a declaration to one or more categories of companies. The directors can also be held personally liable under section 218 of the Companies Act for the losses incurred by any person as a result of the directors’ delinquent conduct.

As an alternative to a declaration of delinquency, a court may make an order placing a person under probation. This would occur when the court is satisfied that the declaration is justified. Such order for probation (similar to a suspended sentence) will be made subject to conditions that the court considers appropriate and which may subsist for a period not exceeding five years.

If a person is placed under probation, he or she is to be supervised by a mentor in any future participation as a director, while the order remains in force, or be limited to serving as a director of a private company or of a company of which that person is the sole shareholder.

Any person who has been declared delinquent or subject to an order of probation may apply to court to suspend the order of delinquency and substitute an order of probation, with or without conditions, at any time more than three years after the order of delinquency was made, or to set aside an order of delinquency at any time more than two years after it was suspended, or an order of probation at any time after such order was made. This will not be available to a person declared delinquent on account of having consented to serve as a director whilst ineligible or disqualified under the Companies Act or whilst under probation in terms of the Companies Act or the Close Corporations Act and acted in a manner that contravened that order.

Without limiting the powers of the court, a court may order as conditions applicable or ancillary to a declaration of delinquency or probation that the person concerned:

When is a director delinquent? – Section 162

A declaration of delinquency can only be made in relation to one of the legislated grounds stipulated in section 162 of the Companies Act, and there must be clear “evidence” of any conduct that warrants a director being declared delinquent.[1]

In terms of section 162 of the Companies Act, a company, a shareholder, a director, company secretary or prescribed officer of the company, a registered trade union that represents employees of the company, or any other representative of the employees of the company, may apply to court for an order declaring a person delinquent or under probation if:

a) the person is a director of that company, or within 24 months immediately preceding the application, was a director of that company; and amongst other things –
b) such director has:
(i) whilst under a probation order in terms of the Companies Act or the Close Corporations Act, acted in a manner that contravened that order;

(ii) grossly abused the position of a director;

(iii) intentionally, or by gross negligence, inflicted harm upon the company or a subsidiary of the company, contrary to the provisions of the Companies Act;

(iv) acted in any manner that amounts to gross negligence, wilful misconduct, or breach of trust in relation to the performance of such director’s duties.

Ordinary negligence or poor decision-making are insufficient for a delinquency order. Proof of gross negligence, wilful misconduct, or deceptive conduct are necessary.[2] For conduct to qualify as gross negligence, “… it must demonstrate, where there is found to be conscious risk taking, a complete obtuseness of mind or, where there is no conscious risk taking, a total failure to take care”.[3]

The Companies Act also provides that a director who uses his or her position or any information obtained while acting in the capacity of a director to:

gain an advantage for him- or herself or for another person other than the company or a wholly owned subsidiary of the company; or
knowingly cause harm to the company or a subsidiary of the company;
must be declared delinquent.

Any organ of state responsible for the administration of legislation may also apply to court for an order declaring a director delinquent, if such director has repeatedly been personally subjected to a compliance notice or similar enforcement mechanism for substantially similar conduct in terms of any legislation.

A court will be obligated to declare a person to be a delinquent director if the person consented to serve as a director while ineligible or disqualified. Such disqualifications are set out in section 69 of the Companies Act and include that such person:

was an unrehabilitated insolvent; or
is prohibited in terms of any public regulation to be a director; or
has been removed from an office of trust on the grounds of misconduct involving dishonesty; or
has been convicted in the Republic or elsewhere for theft, fraud, forgery, or any conduct involving fraud, misrepresentation or dishonesty or offences involving various statutes such as the Insolvency Act, the Close Corporation Act, the Competition Act, the Financial Intelligence Centre Act (F**A), the Securities Services Act or the Prevention and Combating of Corrupt Activities Act.
Any person who has at least twice been personally convicted of an offence or subjected to an administrative fine or similar penalty in terms of any legislation could also be subject to an application for a declaration of delinquency.

It is important to note that an order for probation applies to directors who were present at meetings of companies and failed to vote against a resolution despite the inability of the company to satisfy the solvency and liquidity test as set out in section 4 of the Companies Act. The solvency and liquidity test would apply to directors and any person who is obligated to consider whether, having regard to the reasonably foreseeable financial circumstances of the company at a particular point in time that the assets of the company are fairly valued, are equal to or exceed the liabilities of the company, and it appears that the company will be able to pay its debts as they become due in the ordinary course of business for a period of 12 months thereafter.

Furthermore, any person may be placed under probation if he or she:

acts in a manner materially inconsistent with the duties of a director; or
acts in or supports a decision of a company to act in a manner which results in oppressive or prejudicial conduct; or
on some basis acted in a manner which constituted an abuse of the separate juristic personality of such company.
The court may also make an order placing a person under probation if, at any period of ten years after the effective date of the Companies Act, the person has been a director of more than one company (irrespective whether concurrently, sequentially or at unrelated times) and during the time that the person was a director of each of such companies, two or more of those companies each failed to fully pay all of its creditors or meet all of its obligations, except in terms of a business rescue plan as contemplated in Chapter 6 of the Companies Act or a compromise with creditors in terms of section 155 of the Companies Act. The effect of this provision is that directors who serially trade recklessly and/ or cause companies to enter liquidation may be declared delinquent by the imposition of a probation order. The court may only make such an order if the director was wholly or partly responsible for the company failing to meet its obligations, and that such order is justified given the circumstances of the businesses’ failures and the director’s involvement.

Source: Moneyweb by Eric Levenstein - Head of Insolvency & Business Rescue and Nastascha Harduth - Director