Know What Triggers SARS Penalties

The most common SARS penalties SMEs face include:

🚩 Late submission of returns (VAT, PAYE, Provisional Tax, Income Tax)
🚩 Late payment of taxes owed
🚩 Understatement of income or incorrect declarations
🚩 Errors in VAT claims or payroll calculations
🚩 Failure to maintain proper supporting documentation

📌 Tip: Most penalties are avoidable with good systems and professional oversight.

Understand the Main Penalty Types

Late Submission Penalties:

• SARS imposes administrative penalties for late returns.
• These often start at R250 and can build up monthly until submitted.

Late Payment Penalties:

• Penalty of 10% of the unpaid amount.
• SARS also charges daily interest until fully paid.

Understatement Penalties:

• These range from 0% to 200% depending on the severity of the error.
• SARS assesses intent, negligence, or deliberate misstatements.

📌 Tip: The cost of ignoring these far outweighs the cost of staying compliant.

Submit Returns On Time, Every Time

Key submission deadlines:

📌 Tip: At Bletchleys, we monitor every single deadline so you never miss a submission.

Keep SARS Payments Up to Date

Submitting on time isn’t enough — payment must also reflect in SARS’s account by the deadline.

• Set up payment reminders or scheduled payments.
• Don’t wait until your cash flow allows — SARS charges interest immediately.

📌 Tip: We help SME clients forecast cash flow around upcoming SARS payments so they’re never caught short.

Ensure Accurate and Clean Submissions

• Verify VAT claims are supported by valid tax invoices.
• Check payroll calculations match EMP201 returns.
• Avoid estimations when submitting provisional tax.

📌 Tip: Sloppy or rushed submissions often lead to costly verifications or audits.

Maintain Proper Records

SARS requires businesses to keep full supporting documentation for at least 5 years.

• Invoices, receipts, and payment records
• Payroll records and employee tax certificates
• Bank statements and reconciliations
• Asset registers and loan agreements

📌 Tip: Using cloud-based accounting software like Xero, with Bletchleys managing your records, simplifies long-term compliance.

Don’t Ignore SARS Letters or Verifications

If SARS contacts you:

• Respond quickly
• Submit requested documents professionally
• Avoid delays that may escalate the situation

📌 Tip: Bletchleys handles SARS correspondence directly, taking the pressure off your desk.

Get Expert Oversight

Even if you have an in-house bookkeeper, SARS compliance often requires expert guidance to prevent small mistakes from becoming expensive problems.

At Bletchleys, we:
✔ Handle SARS submissions for you
✔ Monitor changing tax rules
✔ Keep your records audit-ready
✔ Handle SARS correspondence and verifications
✔ Prevent penalties before they happen

📌 Tip: Our clients often avoid thousands of rands in unnecessary penalties simply because we stay ahead of the risk.