If Sars has failed to deal with your complaint, try the tax ombudsman, suggests Georgina Crouth
Whether you’re personally submitting your taxes or employing a tax practitioner to do the work, many people have found their dealings with the South African Revenue Service (Sars) frustrating. And if you’ve had to visit a branch, the experience is often more discouraging.
The only certainties in life are death and taxes. And you don’t want to be on the wrong side of the taxman. With year-end having closed at the end of February, the Office of the Tax Ombudsman is readying for a raft of complaints, but not many people are aware of the existence of the office, or the vital role it plays in giving aggrieved taxpayers a channel of complaint – and keeping Sars on its toes.
Before it was launched in 2013 under the Tax Administration Act to resolve taxpayers’ issues with the revenue service (after they’ve exhausted Sars’s internal processes), taxpayers were at the mercy of Sars and had no recourse. Now, taxpayers have an avenue of complaint that’s not only impartial, but free – which is critical considering taxpayers’ rightful concerns about the way their money is spent.
As Judge Bernard Ngoepe, the Tax Ombudsman, observed during a presentation at the University of Johannesburg at the end of last year: “Taxes collected by Sars should be used to alleviate the plight of the poor, not to line the pockets of politically connected individuals.”
Building confidence in the fairness of the tax system (never mind the tension between Finance Minister Pravin Gordhan and Sars Commissioner Tom Moyane) is vital to ensure compliance because the tax base is already small.
The ombud’s office works to strike a balance between Sars’ duties and powers and taxpayers’ rights and obligations, which means complaints are dealt with as quickly as possible because once taxpayers approach the Office of the Tax Ombudsman, they have already exhausted Sars’ processes. Each case they accept they regard as urgent.
With an average turnaround time of only 15 days – despite a relatively small staff complement – the office appears to be one of the most efficient ombud’s offices in the country. But the chief executiveof the Tax Ombud, advocate Eric Mkhawane, takes a more measured approach. “The 15 business days turnaround time was implemented on the basis that, by the time taxpayers come to lodge their complaints with the Office of the Tax Ombud, Sars already had the opportunity to try to resolve the matter. This means Sars would not be seeing the complaints for the first time.”
Being an independent division of the revenue service, the ombud’s office has access to Sars’ systems.
“In most cases we can see from investigations what the problem is and can immediately make recommendations to Sars on how to resolve the issue.
“Of course, some cases are quicker to resolve because of their nature, some go above the 15 days turnaround time because to the complexity of the matter. Sometimes these cases involve extensive investigations and we make taxpayers aware when we are not able to meet the set turnaround time.”
Worryingly, Sars is allowed to “dip” into bank accounts to help itself to outstanding tax debt. This could result in taxpayers being prejudiced if, for example, Sars helps itself to your entire salary and you can’t meet your financial obligations. But Mkhawane points out that processes need to be followed before Sars can do that.
“Sars should communicate with taxpayers before they take any debt recovery steps. If this is not followed, taxpayers have a right to complain. However, it is important for taxpayers to update their registration details with Sars each time they, for example, change their contact numbers, address, work details etc, because in most of those circumstances taxpayers had not updated their details with Sars.”
Despite the fact the Office of the Tax Ombudsman can’t make binding recommendations, 75 percent of the cases it handles are decided in favour of the taxpayer and Sars, generally, respects those decisions because it understands the office’s mandate. “The Office of the Tax Ombudsman makes recommendations to Sars after investigations, but we are dependent on Sars to finalise the matters.”
And if Sars fails to implement the Office of the Tax Ombudsman’s recommendations, it has to explain why. This is reported in the annual report to the minister of finance and tabled in Parliament.
Most of the complaints the Office of the Tax Ombudsman handles are about outstanding refunds (especially VAT refunds); tax refunds paid but recalled without an explanation; objections and appeals not finalised within the Sars turnaround time; audits taking too long to finalise; identity fraud cases; incorrect payment allocations; Sars not responding to correction requests by taxpayers; and banking details not updated on time.
He said taxpayers and practitioners need to follow the correct process. Often they try to expedite the process by lodging complaints with the Office of the Tax Ombudsman before they’ve exhausted Sars’s complaints mechanisms.
“They also fail to adhere to the prescribed time frames; don’t use the correct channels on how to submit the required documents; and don’t follow up on cases.
The Office of the Tax Ombudsman can only review and address complaints about a service, procedural or administrative matters, arising from the application of the Tax Act.
“Our mandate is narrow and we cannot hold Sars accountable or enforce the implementation of our recommendations.
“The independence of our office from Sars is a concern – and our ombud’s term of office is far too short.
“We also cannot investigate if there is no complaint and our turnaround time is dependent on Sars.”
Wise up. Here's how!
Tips to avoid delays and hitches when dealing with the ombud’s office:
How to complain: lodge complaints by visiting the Office of the Tax Ombud or contacting the office by telephone, fax, post or e-mail to request the complaints form. The form can also be downloaded from www.taxombud.gov.za. Fully complete all sections of the form and sign – the office will not accept unsigned forms. Attach all the relevant supporting documents.
What to expect: they will acknowledge receipt of your complaint and issue a reference number. If they cannot review your complaint, they have to give you a reason or suggest who might be able to help you.
Review process: an operations specialist will be assigned to your complaint. They will conduct an impartial review of the complaint and keep you informed throughout the process. You can also contact us and speak to the operations specialist assigned to your complaint.
Once the investigation has been finalised: at the end of the review, you will be notified of the outcome and if a recommendation is to be made to Sars, it is done within five days.
Keep a record: make detailed notes of all your communications, written or verbal, when engaging with the OTO and with Sars, including the date and time of each contact. Keep all correspondence you send and receive from OTO and Sars – and ask for the consultant’s name.
To contact the Office of the Tax Ombud, phone 0800 662 837, e-mail [email protected], or see www.taxombud.gov.za.
**Follow Georgie on Twitter: @askgeorgie