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Categories: Financial

VDP, SARS and Exchange Control – Good News Ahead?

Article © CA(SA)DotNews by DotNews

Exchange Control

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.

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