With the South African Revenue Service (SARS) now issuing auto-assessment notices to taxpayers, and filing season right around the corner, the tax world is a buzz with activity. All over, SARS and tax advisors are encouraging taxpayers to take proactive steps to ensure that they remain compliant.

However, there is a new curveball that taxpayers have to face – mandatory branch filing for late tax returns.

SARS, in a media release on 28 June 2024, affirmed one of SARS’ strategic objectives as making it easy and simple for taxpayers to meet their legal obligations. In fact, this is also one of the nine key strategic objectives of SARS.

Part of this drive entailed SARS reducing the traffic in its branches by encouraging the use of e-Filing and digital channels. The auto-assessment initiative by SARS is one of the avenues through which SARS has, over time, achieved this aim.

From 1 July 2024, tax practitioners have been hit with a new curveball by SARS – a message that says: “Please note that the tax return older than 5 years cannot be requested via eFiling or MobiApp. Please make an appointment with a branch office for further assistance to request and submit older than 5 years tax return(s).”

So, if you have missed out on a return more than five tax years ago, you can no longer file it on e-Filing.

Traditionally, SARS will notify tax practitioners of such developments, before they happen. However, in this case, there seems to be widespread confusion about the move by SARS. Naturally, this has caused considerable frustration among tax practitioners as a result.

“On the one hand, SARS is trying so hard to enforce voluntary compliance and even forced compliance via their Auto-Assessment system, but in the same breath, they are now preventing people from becoming compliant in a relatively simple manner,” says Andre Bothma, founder of tax firm Irhafu.

Other practitioners appear to share this sentiment, with some considering it to be an arbitrary change by SARS with no real upside for taxpayers or SARS. According to Thomas Lobban, Tax Legal Specialist at the tax and accounting firm Latita Africa: “We just don’t see the point in forcing taxpayers to book a branch appointment to file older tax returns. The e-Filing verification process is arguably already quite sufficient. We need to see some clear indication from SARS as to the reasons for this change.”

The confusing change by SARS, without any announcement or indication on its reasons, has already started to cause frustration among tax practitioners.

“It is already time-consuming to get an appointment with SARS, with people often waiting weeks at a time. What’s more, submitting a tax return on e-Filing is no different to submitting a tax return at the branch. The assessment process remains the same. The verification process remains the same,” says Bothma.

According to Lobban: “SARS is not generally prone to baseless decision-making. However, unless there are good reasons for the branch filing requirement on these returns, SARS will be seen to be talking out of both sides of its mouth – encouraging the transition to its online channels, and apparently seeking to make compliance easy for taxpayers, but also putting administrative blocks and delays in place for those seeking to regularise their tax affairs. This currently looks like a step backwards.

“Until we hear more, it is most practical for taxpayers to seek assistance from their tax practitioners. This will ensure that a branch meeting to file their returns is successful, without them needing to leave for their information and book another appointment, causing further frustration and delay – on top of potential penalties and ever-increasing interest for late submission and payment of tax.”