Penalty and Interest
Irrespective of the mistake made by the taxpayer, SARS will levy penalties for non-compliance and, where tax is underestimated, or payment is late, SARS will also levy interest until the total underestimated/underpaid tax is paid in full.
Taxpayers can face a penalty up to 200% of the value of the tax payable and interest of approximately 10% per annum.
Avoid Imposition of Penalties and Interest
Taxpayers who become aware that they may have made one of the aforementioned mistakes must urgently contact a tax professional to investigate whether an application may be made to SARS to rectify the error, correct the tax filing and avoid penalties and/or interest.
It is important to note, however, that this is typically only possible where SARS is approached before the taxpayer has paid the outstanding tax liability and the appropriate application process is followed.