Quick Facts

• SARS can audit any taxpayer at any time
• Verification takes 21 days, audits take 30 days to 12 months
• You have rights during an audit – SARS must follow the law
• Payment arrangements and compromises are available
• Beware of fake SARS audit scams targeting taxpayers

Understanding SARS Audits

A SARS audit is when the South African Revenue Service checks your tax information. They want to make sure you paid the right amount of tax.

SARS can audit anyone. This does not mean you did something wrong. Many audits are random checks.

An audit looks at your financial records. SARS compares what you told them with your actual income and expenses.

If SARS finds a problem, they may ask you to pay more tax. They can also charge interest and penalties.

Verification vs Audit: What’s the Difference?

SARS uses two different processes. It is important to know which one you are facing.

Verification (Simpler Process)

A verification is a quick check of your tax return. SARS compares your information with what they already have.

• Takes 21 business days after you submit documents
• SARS asks for supporting documents like payslips or bank statements
• Usually only looks at one tax return
• You get a letter asking for documents

Audit (Detailed Investigation)

An audit is a detailed examination of all your financial records. This is more serious and takes longer.

• Takes 30 days to 12 months (sometimes longer)
• SARS looks at multiple years of tax returns
• May involve a field audit at your home or business
• You get a Notification of Audit letter with an assigned auditor
• SARS gives you progress reports every 90 days

Why SARS Audits Taxpayers

SARS selects taxpayers for audits for different reasons. Understanding these reasons can help you avoid problems.

Random Selection

SARS randomly audits some taxpayers every year. This is normal. Even if you did everything correctly, you might be selected.

Red Flags That Trigger Audits

Some things make SARS want to look closer at your taxes:

• Extra income: Rental income, freelance work, or foreign income
• Big deductions: Claiming large expenses that seem too high
• Income doesn’t match spending: You live in an expensive house but declare low income
• Missing information: Your bank reports income you didn’t declare
• Business losses: Your business shows losses year after year
• Cash businesses: Spaza shops, hair salons, or taxi services
• Previous problems: You had issues with SARS before

Automatic Triggers (As of 2025)

SARS now uses computers to find problems. Their system automatically flags certain things:

• Differences between your tax return and what employers report
• Large transfers in and out of your bank accounts
• Buying expensive assets like cars or property
• International money transfers

✅ What to Do When You Get an Audit Notice

Getting a letter from SARS can be scary. But if you respond correctly, the process will be easier.

Step 1: Don’t Panic

An audit does not mean you are in trouble. Many audits find nothing wrong. Stay calm and read the letter carefully.

Step 2: Check If the Letter is Real

Before you do anything, make sure the letter is really from SARS. See the scam section below for how to check.

Step 3: Read Everything Carefully

Your letter will tell you:

• What type of audit (verification or full audit)
• Which tax years they are checking
• What documents you must provide
• The deadline for submitting documents
• The name and contact details of your SARS auditor

Step 4: Respond Immediately

Do not ignore the letter. SARS will assess you based on what they think you owe. This will likely be much more than the real amount.

If you cannot get all documents by the deadline, contact your SARS auditor. Explain your situation. They may give you more time.

Step 5: Contact Your Auditor

Your audit letter includes the name of a SARS official. This is your auditor. You can contact them if you have questions.

It is better to ask questions than to guess what SARS wants.

Your Rights During a SARS Audit

SARS must follow the law when they audit you. You have important rights. Know them and use them.

Right to Be Informed

SARS must tell you what they are doing. You have the right to know:

• Why you were selected for audit
• What they are investigating
• How the audit process works
• Progress reports every 90 days

Right to Fair Treatment

SARS officials must be professional and respectful. They cannot:

• Threaten you or your family
• Ask for bribes
• Force you to pay without proper assessment
• Share your private information with unauthorised people

Right to Representation

You can have someone help you during the audit. This could be:

• A tax practitioner
• An accountant
• A family member who understands taxes

Right to Object and Appeal

If you disagree with SARS findings, you can:

• Ask for reasons for their assessment
• Lodge an objection within 80 business days
• Request suspension of payment while you dispute
• Appeal to the Tax Court if needed

Right to Reasonable Timeframes

SARS must complete audits within reasonable time. For simple audits, this is 30 business days after receiving documents.

Documents You Need for a SARS Audit

SARS will ask for specific documents. The exact documents depend on your situation. Here are the most common ones.

Income Documents

• IRP5 or IT3(a) certificates from your employer
• Bank statements showing all deposits
• Proof of rental income (lease agreements, receipts)
• Invoices if you are self-employed
• Foreign income statements
• Investment statements (dividends, interest)

Expense Documents

• Medical aid tax certificates
• Retirement annuity contribution certificates
• Donation receipts (Section 18A certificates)
• Business expense receipts and invoices
• Travel logbook for business travel claims

Property and Asset Documents

• Proof of purchase for property, cars, or investments
• Sale agreements
• Transfer duty receipts
• Valuations

Business Documents (If Self-Employed)

• Full set of financial statements
• General ledger and journals
• Cashbook
• VAT returns and supporting documents
• Employee tax records (PAYE)

How to Submit Documents

You can submit documents to SARS in three ways:

• eFiling: Scan documents and upload online (maximum 5MB per document, up to 20 documents)
• SARS branch: Take physical documents to any SARS office
• Email: Only if your auditor gives you permission

The SARS Audit Process: What to Expect

Here is what happens during a typical SARS audit. Knowing the steps helps you prepare.

Phase 1: Notification (Day 1)

SARS sends you a Notification of Audit letter. This letter includes:

• Your auditor’s name and contact details
• List of documents needed
• Deadline for submission (usually 21 days)
• Reference number for your audit

Phase 2: Document Submission

You gather and submit all requested documents. Make sure everything is:

• Complete (all pages included)
• Clear (good quality scans)
• Organised (label everything clearly)
• Submitted on time

Phase 3: SARS Review

Your auditor examines all documents. They compare your tax return with the evidence you provided. This can take:

• 30 business days for simple audits
• 3 to 6 months for complex audits
• Up to 12 months for very complicated cases

Phase 4: Additional Requests

SARS may ask for more documents. This is normal. They might need:

• Clarification on certain transactions
• Documents from your bank or employer
• Information about specific expenses

Phase 5: Progress Reports

SARS must give you progress reports every 90 calendar days. These reports tell you how far the audit has gone.

Phase 6: Audit Findings

When the audit is done, SARS will send you one of two letters:

• Finalisation of Audit Letter: Everything is fine, audit is closed
• Audit Findings Letter: They found problems and will issue a new assessment

Phase 7: New Assessment (If Needed)

If SARS found you owe more tax, they will issue an additional assessment. This shows:

• How much extra tax you owe
• Interest charges
• Penalties (if applicable)
• Payment deadline

✅ If You Can’t Afford to Pay

Owing money to SARS is scary. But you have options. Never ignore a tax debt. SARS has strong collection powers.

Option 1: Payment Arrangement (Instalment Plan)

A payment arrangement lets you pay your tax debt over time. This is the most common solution.

How it works:

• You apply through eFiling or the SARS Contact Centre
• You propose monthly payment amounts
• SARS reviews your proposal
• If approved, you make regular monthly payments

Requirements:

• All tax returns must be up to date
• You must show you can make the payments
• Interest continues to add to the debt
• No write-off of penalties or interest

Option 2: Compromise of Tax Debt

A compromise means SARS agrees to accept less than you owe. They may write off interest and penalties.

When you qualify:

• You have genuine financial hardship
• You can prove your income and expenses
• You haven’t had a compromise in the last 3 years
• All tax returns are submitted

What you need to provide:

• Bank statements (last 3 months)
• Proof of income (payslips, business income)
• List of all assets (property, cars, investments)
• List of all debts (loans, credit cards, accounts)
• Statement explaining your financial situation

Option 3: Suspension of Payment

If you disagree with the assessment, you can ask SARS to suspend payment while you dispute it.

• You must first lodge an objection
• Then request suspension of payment
• SARS decides based on your tax history
• If approved, collection stops during the dispute

What Happens If You Don’t Pay

SARS has strong collection powers. If you ignore your tax debt:

• They will send Final Letters of Demand (10 days to pay)
• They can take money directly from your bank account
• They can instruct your employer to deduct from your salary
• They can appoint debt collectors
• They can get a court judgment against you
• Your business could be liquidated
• Criminal charges in serious cases

Penalties and Interest (As of November 2025)

If SARS finds you owe more tax, you may face penalties and interest. Understanding these helps you know what to expect.

Interest on Unpaid Tax

SARS charges interest on tax you didn’t pay on time. Current rate (as of November 2025):

• 10.75% per year on outstanding tax
• Interest starts from the day tax was due
• Interest continues until you pay in full
• This rate can change when the Reserve Bank changes interest rates

Understatement Penalties

If you declared less income than you should have, SARS can charge understatement penalties. The penalty depends on how serious the problem is:

Type of Error	Penalty
Honest mistake (substantial understatement)	25% of shortfall
Carelessness (reasonable care not taken)	50% of shortfall
Gross negligence (reckless)	100% of shortfall
Intentional tax evasion	150% of shortfall
Fraud (hiding income deliberately)	200% of shortfall

Late Submission Penalties

• First month late: R250 penalty
• Each additional month: R250 more (up to R16,000)

Example: How Much You Could Owe

Can Penalties Be Reduced?

Yes. You can request remission (reduction) of penalties if:

• You have a good reason for the error
• You cooperated fully with SARS
• This is your first offence
• You voluntarily corrected the error

🚨 CRITICAL: SARS Audit Scams

Criminals are using fake SARS audits to steal money and personal information. This is very common, especially during tax season (July to October).

Latest SARS Audit Scams (2025)

Scam 1: Fake Audit SMS

You get an SMS saying SARS is auditing your tax refund. The message includes a link. This is a SCAM.

• The link goes to a fake website that looks like SARS
• They ask for your eFiling password and banking details
• They steal your information and access your accounts

Scam 2: Threatening Phone Calls

Someone phones claiming to be from SARS. They say you failed your audit. They threaten:

• Arrest if you don’t pay immediately
• Court summons
• Blacklisting
• Seizure of your property

They demand immediate payment into a specific bank account. This is a SCAM.

Scam 3: Fake Settlement Notice Email

You receive an email with subject “Settlement Notification – Action Required.” It includes a PDF attachment with fake bank account details. This is a SCAM.

Scam 4: Fake Tax Practitioners

Someone offers to help you with your SARS audit for a fee. They promise to reduce your tax or make the audit go away. Then they:

• Submit fraudulent documents to SARS
• Disappear with your money
• Leave you with bigger problems

How to Spot a Fake SARS Communication

Real SARS communications:

• ✅ Come through eFiling or post (registered mail)
• ✅ Never include clickable links to other websites
• ✅ Never ask for eFiling passwords
• ✅ Never ask for credit card details
• ✅ Give you time to respond (at least 21 days)
• ✅ Include a specific reference number
• ✅ Come from official SARS email addresses (ending in @sars.gov.za)

Fake SARS communications:

• ❌ Demand immediate payment
• ❌ Ask you to click on links
• ❌ Request payment into personal bank accounts
• ❌ Threaten arrest or immediate legal action
• ❌ Come from strange email addresses
• ❌ Have poor spelling or grammar
• ❌ Ask for passwords or PINs

What to Do If You Suspect a Scam

1. Don’t click any links in suspicious emails or SMS messages
2. Don’t give any information to the caller
3. Don’t pay any money into accounts provided in suspicious communications
4. Check on eFiling: Log in directly to check if you really have an audit
5. Call SARS directly: Use the official number 0800 00 7277
6. Report the scam: Forward suspicious messages to [email protected]
7. Report to police: Open a case at your local police station

Additional Help and Resources

SARS Contact Information

General enquiries	0800 00 7277 (SARS)
International callers	+27 11 602 2093
Debt management email	[email protected]
Scam reporting	[email protected]
USSD (no airtime needed)	*134*7277#
Operating hours	Weekdays 8:00 – 16:00 Wednesdays 9:00 – 16:00
Website	www.sars.gov.za

When to Get Professional Help

Consider hiring a tax professional if:

• Your audit involves large amounts of money
• You have complicated business finances
• You disagree with SARS findings
• You need help with a compromise application
• You are facing criminal charges

Look for registered tax practitioners. Check their registration at www.sars.gov.za

Preventing Future Audits

Reduce your chances of being audited:

• Submit all tax returns on time
• Declare all income (even cash income)
• Keep proper records for 5 years
• Only claim legitimate expenses
• Update your contact details with SARS
• Respond to SARS queries immediately
• Use the Voluntary Disclosure Programme if you made mistakes

Getting a SARS audit notice is stressful. But most taxpayers who cooperate and provide documents have nothing to worry about.

Remember these key points:

• Respond immediately – never ignore SARS letters
• Know your rights – SARS must follow the law
• Keep all tax documents for at least 5 years
• Be careful of scams – verify everything
• If you can’t pay, ask for a payment arrangement
• Get professional help for complex cases

Most importantly, never try to hide from SARS. Being honest and cooperative will always get you the best outcome.