The South African Revenue Service (SARS) announced on Tuesday 10 October 2017, that with the close of the Special Voluntary Disclosure Programme (SVDP) on 31 August 2017, over 2,000 SDVP applications were made and a tax liability of R1,181,734,842 had been calculated.
The SVDP was announced in the 2016 Budget Speech by ex-Finance Minister Pravin Gordhan.
“The SVDP was designed to provide taxpayers with an opportunity to regularise their unauthorised foreign assets and income through the process of voluntarily disclosing their tax and exchange control contraventions to SARS and the South African Reserve Bank” says Stephan Spamer, Partner and Head of the Tax Practice at Baker McKenzie in Johannesburg.
“This was in relation to their offshore funds and prior to the first automatic exchange of information in terms of the Common Reporting Standards, which took effect on 31 August 2017.”
Rui Lopes, Candidate Attorney in the Tax Practice at Baker McKenzie noted further that: “In the announcement, SARS confirmed that the processing of the applications was still in progress and was being processed by the VDP unit of SARS. The outcome of the SVDP applications should be known by the end of the current financial year at the latest.”
Spamer adds:”Should a taxpayer not have applied for offshore tax relief as yet, they may still do so through the utilisation of the normal VDP process which requires a specific procedure to be followed.”