Mazars - VDP, SARS AND EXCHANGE CONTROL – GOOD NEWS AHEAD?

2015-09-22

We have reported on the Voluntary Disclosure Program (VDP) and SARS. Taxpayers with undeclared off-shore accounts were advised to enter the VDP by August 12th. The deadline does not apply to you if:

• You have already disclosed any off-shore assets to SARS, or

• SARS are unaware of undisclosed accounts you have – if you have undisclosed off shore assets, seriously consider entering the VDP as more and more tax havens are disclosing names (including trusts) to SARS.

 SARS levies a 10% penalty plus a late submission penalty (this is subject to a maximum of R16 000). Proposed new tax legislation will eliminate the 10% penalty. 
The other disincentive for residents normalising their affairs is the high penalties imposed by Exchange Control on the off-shore amounts. This can be as much as 30% of the value of these funds. 
Exchange Control is reportedly considering offering amnesty to residents to encourage them to declare undisclosed off shore assets. This will be a significant step and let’s see how it develops.